Question

Problem 4-5A Preparing trial balances, closing entries, and financial statements LO C3, P2, P3

The adjusted trial balance of Karise Repairs on December 31, 2017, follows. KARISE REPAIRS Adjusted Trial Balance December 31, 2017 No. Account Title Debit Credit 101 Cash $ 64,000 124 Office supplies 1,000 128 Prepaid insurance 2,100 167 Equipment 60,000 168 Accumulated depreciation—Equipment $ 6,000 201 Accounts payable 13,500 210 Wages payable 700 301 C. Karise, Capital 31,000 302 C. Karise, Withdrawals 15,000 401 Repair fees earned 157,500 612 Depreciation expense—Equipment 6,000 623 Wages expense 38,000 637 Insurance expense 1,100 640 Rent expense 15,000 650 Office supplies expense 3,900 690 Utilities expense 2,600 Totals $ 208,700 $ 208,700 Assume there are no owner investments in 2017. Required: 1a. Prepare an income statement for the year 2017. 1b. Prepare a statement of owner's equity for the year 2017. 1c. Prepare a classified balance sheet at December 31, 2017. 2. Complete the work sheet using the adjusted trial balance in the first two columns of a six-column table. Use columns three and four for closing entry information and the last two columns for a post-closing trial balance. 3. Using information from the work sheet in Requirement 2, prepare the appropriate closing entries.

Answer 1