Question

Below is the unadjusted trial balance for Walton Anvils as of December 31, 2016, and the data for the adjustments. There is also an Excel Template for this problem that you may download and use (or you may use your own).

Walton Anvils
Unadjusted Trial Balance
December 31, 2016
	Balance
Account Title	Debt	Credit
Cash	$    16,900.00
Accounts Receivable	17,500
Prepaid Rent	2,500
Office Supplies	1,900
Equipment	23,000
Accumulated Depreciation - Equipment		$       7,000.00
Accounts Payable		6,200.00
Salaries Payable
Unearned Revenue		5,600.00
Common Stock		28,000.00
Retained Earnings		1,600.00
Dividends	4,500
Service Revenue		20,800.00
Salaries Expense	2,900
Rent Expense
Depreciation Expense - Equipment
Supplies Expense
Total	$    69,200.00	$    69,200.00

Adjustment Data

a. Unearned revenue still unearned at December 31, 2016	$1,800
b. Prepaid rent still in force at December 31, 2016	$2,300
c. Office supplies used	$1,400
d. Depreciation	$380
e. Accrued Salaries Expense at December 31, 2016	$210

Requirements

Open T-accounts using the balances in the unadjusted trial balance.

Complete the worksheet for the year ended December 31, 2016.

Prepare the adjusting entries and post to the T-accounts.

Prepare the adjusted trial balance.

Prepare the income statement, the statement of retained earnings, and the classified balance sheet in report form.

Prepare the closing entries and post to the T-accounts.

Prepare a post-closing trial balance.

Calculate the current ratio for the company.

Answer 1

As per policy, only four parts of a question is allowed to answer, so answering 1 - 4 :

1) Adjusting journal entries:

Date	Accounts Titles	debit $	credit $
Dec 31 16 (a)	Unearned reve	3800
	Service revenue		3800
b	Rent expense	200
	Prepaid Rent		200
c	Off Supplies Expense	1400
	Off. Supplies		1400
d	Depreciation Exp	380
	Acc Dep - Eq.		380
e	salary expense	210
	Salary payable		210

2) T-Accounts :

Debit Entries	Amount $	Credit Entries	Amount $
Unearned Revenue a/c:
a	3800	OB	5600
CB	1800
Service Revenue a/c:
CB	24600	OB	20800
		a	3800
Rent Exp A/c:
b	200
Prepaid Rent a/c:
OB	2500	b	200
		CB	2300
Office Supplies exp a/c:
c	1400
Office Supplies a/c:
OB	1900	c	1400
		CB	500
Depreciation Exp. a/c:
d	380
Acc. Dep - Eq. a/c:
CB	7380	OB	7000
		d	380
Salary exp a/c:
OB	2900	CB	3110
e	210
Salary Payable a/c:
		e	210

3) Adjusted Trial Balance :

Accounts Titles	Debit $	Credit $
CAsh	16900
AR	17500
Prep Rent	2300
Off. Supplies	500
Equip	23000
Acc Dep - Eq		7380
AP		6200
Salary payable		210
Unearned Revenue		1800
CS		28000
RE		1600
Dividend	4500
Service Revenue		24600
salary exp	3110
rent exp	200
depre exp.	380
supplies exp	1400
Total	69790	69790

4) Income Statement :

Service Revenue		$24600
Less: Expenses :
salary exp	3110
rent exp	200
depre exp.	380
supplies exp	1400
Total Expenses		5090
Net Income		$19510