Question

1) Use the following information to prepare adjusting entries for Gilbert Holdings

2) Then make an adjusted trial balance, income statement & balance sheet for the information

a. On April 1, 2019, Gilbert Holdings signed a 4.30% bank loan due in 4 years. This is the only outstanding note payable.

b. Prepaid insurance represents a 4-month insurance policy purchased on December 1.

c. On Oct 1, 2019, Gilbert Holdings paid $11,880 for a 9-month lease for office space.

d. Unearned revenue represents a 12-month contract for consulting services. The payment was received on July 1, 2019.

e. Supplies on hand total $10,480.

f. Equipment is depreciated on a straight-line basis; residual value is estimated to be $15,000 with an estimated service life of 10 years. The assets were held the entire year.

g. On Nov 1, Gilbert Holdings issued Monroe Supplies an 3-month note receivable at a 8.2% annual interest rate.

h. The company uses the percentage-of-receivables basis for estimating uncollectible accounts. The aging schedule of accounts receivable must be completed to determine management's desired balance for 2019.

i. Accrued wages totaling $35,838 were unpaid and unrecorded at December 31, 2019.

j. Utility costs incurred but unrecorded for the month of December were estimated to be $2,561.

	DR	CR
Cash	67,188
Accounts Receivable	265,584
Allowance for Doubtful Accounts		11,194
Interest Receivable
Note Receivable	113,180
Merchandise Inventory	194,172
Prepaid Insurance	7,128
Prepaid Rent	11,880
Supplies	30,096
Equipment	277,464
Accumulated Depreciation - Equipment		29,304
Accounts Payable		27,746
Salaries & Wages Payable
Unearned Revenue		32,000
Interest Payable
Utilities Payable
Note Payable (final payment due 2023)		188,100
Common Stock		145,200
Retained Earnings		224,400
Dividends	64,680
Sales		2,773,980
Consulting Revenue
Sales Returns and Allowances	15,840
Sales Discounts	34,056
Cost of Goods Sold	1,888,788
Salaries & Wages Expense	430,056
Depreciation Expense - Equipment
Bad Debt Expense
Insurance Expense
Rent Expense
Supplies Expense
Utilities Expense	31,812
Interest Revenue
Interest Expense
	3,431,924	3,431,924

Age of Accounts	Balance December 31, 2019	Estimated % Uncollectible	Estimated Amount Uncollectible
Current	159,350	2%	3,187.01
1–30 days past due	66,396	4%	2,655.84
31–90 days past due	31,870	20%	6,374.02
Over 90 days past due	7,968	37%	2,947.98
Total Accounts Receivable	$             265,584		15,165

Answer 1

ANSWER: