In: Accounting
The Moto Hotel opened for business on May 1, 2017. Here is its
trial balance before adjustment on May 31.
MOTO
HOTEL Trial Balance May 31, 2017 |
||||||
Debit |
Credit |
|||||
Cash | $ 2,333 | |||||
Supplies | 2,600 | |||||
Prepaid Insurance | 1,800 | |||||
Land | 14,833 | |||||
Buildings | 67,600 | |||||
Equipment | 16,800 | |||||
Accounts Payable | $ 4,533 | |||||
Unearned Rent Revenue | 3,300 | |||||
Mortgage Payable | 33,600 | |||||
Common Stock | 59,833 | |||||
Rent Revenue | 9,000 | |||||
Salaries and Wages Expense | 3,000 | |||||
Utilities Expense | 800 | |||||
Advertising Expense |
500 |
|||||
$110,266 |
$110,266 |
Other data:
1. | Insurance expires at the rate of $450 per month. | |
2. | A count of supplies shows $1,070 of unused supplies on May 31. | |
3. | (a) Annual depreciation is $3,840 on the building. | |
(b) Annual depreciation is $3,240 on equipment. | ||
4. | The mortgage interest rate is 5%. (The mortgage was taken out on May 1.) | |
5. | Unearned rent of $2,630 has been earned. | |
6. | Salaries of $730 are accrued and unpaid at May 31. |
(a) Prepare a ledger using T-accounts. Enter the trial balance amounts and post the
adjusting entries.
(b) Prepare an adjusted trial balance on May 31.
(c) Prepare an income statement and a retained earnings statement for the month of May
and a classified balance sheet at May 31.
(d) Identify which accounts should be closed on May 31.