In: Accounting
The Crane Hotel opened for business on May 1, 2022. Here is its
trial balance before adjustment on May 31.
CRANE HOTEL Trial Balance May 31, 2022 |
||||||
---|---|---|---|---|---|---|
Debit |
Credit |
|||||
Cash |
$ 2,403 | |||||
Supplies |
2,600 | |||||
Prepaid Insurance |
1,800 | |||||
Land |
14,903 | |||||
Buildings |
70,000 | |||||
Equipment |
16,800 | |||||
Accounts Payable |
$ 4,603 | |||||
Unearned Rent Revenue |
3,300 | |||||
Mortgage Payable |
36,000 | |||||
Common Stock |
59,903 | |||||
Rent Revenue |
9,000 | |||||
Salaries and Wages Expense |
3,000 | |||||
Utilities Expense |
800 | |||||
Advertising Expense |
500 |
|||||
$112,806 |
$112,806 |
Other data:
1. | Insurance expires at the rate of $450 per month. | |
2. | A count of supplies shows $1,160 of unused supplies on May 31. | |
3. | (a) Annual depreciation is $3,480 on the building. | |
(b) Annual depreciation is $2,880 on equipment. | ||
4. | The mortgage interest rate is 6%. (The mortgage was taken out on May 1.) | |
5. | Unearned rent of $2,580 has been earned. | |
6. |
Salaries of $760 are accrued and unpaid at May 31. |
Prepare a ledger using T-accounts. Enter the trial balance amounts and post the adjusting entries. (Post entries in the order of journal entries presented in the previous question.)
Ledgers using T-Accounts - Entering trial balance amounts and posting adjusting entries.
T-Accounts | ||||||||
Cash | Supplies | |||||||
Beg. Bal. | $2,403 | Beg. Bal. | $2,600 | May. 31 | $1,440 | |||
May. 31 | $1,160 | |||||||
Prepaid Insurance | Land | |||||||
Beg. Bal. | $1,800 | May. 31 | $450 | Beg. Bal. | $14,903 | |||
Buildings | Equipment | |||||||
Beg. Bal. | $70,000 | Beg. Bal. | $16,800 | |||||
Accounts Payable | Unearned Rent Revenue | |||||||
Beg. Bal. | $4,603 | May. 31 | $2,580 | Beg. Bal. | $3,300 | |||
Mortgage Payable | Common Stock | |||||||
Beg. Bal. | $36,000 | Beg. Bal. | $59,903 | |||||
Rent Revenue | Salaries and Wages Expense | |||||||
May. 31 | $9,000 | May. 31 | $3,000 | |||||
May. 31 | $2,580 | May. 31 | $760 | |||||
Utilities Expense | Advertising Expense | |||||||
May. 31 | $800 | May. 31 | $500 | |||||
Insurance Expense | Supplies Expense | |||||||
May. 31 | $450 | May. 31 | $1,440 | |||||
Accumulated Depreciation - Building | Accumulated Depreciation - Equipment | |||||||
May. 31 | $3,480 | May. 31 | $2,880 | |||||
Depreciation Expense - Building | Depreciation Expense - Equipment | |||||||
May. 31 | $3,480 | May. 31 | $2,880 | |||||
Interest Payable | Interest Expense | |||||||
May. 31 | $180 | May. 31 | $180 | |||||
Salaries and Wages Payable | ||||||||
May. 31 | $760 | |||||||
* $2,600 - $1,160 = $1,440. | ||||||||
** $36,000*6/100*1/12 = $180 |