Question

The unadjusted trial balance for Sunland Engineering at its year end, December 31, 2017, is as follows: SUNLAND ENGINEERING Trial Balance December 31, 2017 Debit Credit Cash $8,400 Accounts receivable 5,850 Supplies 4,750 Prepaid insurance 7,560 Notes receivable 12,300Equipment 27,400Accumulated depreciation—equipment $8,220 Accounts payable 4,600 H. Duguay, capital 39,440 H. Duguay, drawings 52,500 Service revenue 106,000 Salaries expense 39,500 $158,260 $158,260 Additional information: 1. Revenue of $10,550 was earned but unrecorded and uncollected as at December 31, 2017. 2. On June 1, the company purchased a one-year insurance policy. 3. Depreciation on the equipment for 2017 is $2,740. 4.A count on December 31, 2017, showed $1,800 of supplies on hand. 5.The four-month, 4% note receivable was issued on October 1, 2017. Interest and principal are payable on the maturity date. Make adjusting entries for the year ended December 31, 2017. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Date Account Titles and Explanation Debit Credit Dec. 31 (To accrue revenue earned but not billed or collected)Dec. 31 (To record insurance expired)Dec. 31 (To record depreciation)Dec. 31 (To record supplies used)Dec. 31 (To record accrued interest) Post the adjusting entries. (Post entries in the order of journal entries presented in the previous part.) Accounts Receivable Interest Receivable Prepaid Insurance Supplies Accumulated Depreciation-Equipment Service Revenue Interest Revenue Supplies Expense Depreciation Expense Insurance Expense Make closing entries. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Date Account Titles and Explanation Debit Credit Dec. 31 (To close revenue accounts)Dec. 31 (To close expense accounts)Dec. 31 (To close profit to capital)Dec. 31 (To close drawings account)

Answer 1

No	Date	Account Titles and Explanation	Debit	Credit
1	Dec. 31	Accounts receivable	10550
		Service revenue		10550
		(To accrue revenue earned but not billed or collected)
2	Dec. 31	Insurance expense ($7560 x 7/12)	4410
		Prepaid insurance		4410
		(To record insurance expired)
3	Dec. 31	Depreciation expense	2740
		Accumulated Depreciation-Equipment		2740
		(To record depreciation)
4	Dec. 31	Supplies Expense ($4750 - $1800)	2950
		Supplies		2950
		(To record supplies used)
5	Dec. 31	Interest receivable ($12300 x 4% x 3/12)	123
		Interest revenue		123
		(To record accrued interest)

Accounts Receivable					Interest Receivable
Dec. 31 bal.	5850				Dec. 31 bal.	0
Adj. 1	10550				Adj. 5	123
Dec. 31 adj. bal.	16400				Dec. 31 adj. bal.	123
Prepaid Insurance					Supplies
Dec. 31 bal.	7560				Dec. 31 bal.	4750
		4410	Adj. 2				2950	Adj. 4
Dec. 31 adj. bal.	3150				Dec. 31 adj. bal.	1800
Accumulated Depreciation-Equipment					Service Revenue
Dec. 31 bal.		8220			Dec. 31 bal.		106000
		2740	Adj. 3				10550	Adj. 1
Dec. 31 adj. bal.		10960			Dec. 31 adj. bal.		116550
Interest Revenue					Supplies Expense
Dec. 31 bal.		0			Dec. 31 bal.	0
		123	Adj. 5		Adj. 4	2950
Dec. 31 adj. bal.		123			Dec. 31 adj. bal.	2950
Depreciation Expense					Insurance Expense
Dec. 31 bal.	0				Dec. 31 bal.	0
Adj. 3	2740				Adj. 2	4410
Dec. 31 adj. bal.	2740				Dec. 31 adj. bal.	4410

No	Date	Account Titles and Explanation	Debit	Credit
1	Dec. 31	Service revenue	116550
		Interest revenue	123
		Income summary		116673
		(To close revenue accounts)
2	Dec. 31	Income summary	49600
		Salaries expense		39500
		Supplies expense		2950
		Depreciation expense		2740
		Insurance expense		4410
		(To close expense accounts)
3	Dec. 31	Income summary ($116673 - $49600)	67073
		H. Duguay, capital		67073
		(To close profit to capital)
4	Dec. 31	H. Duguay, capital	52500
		H. Duguay, drawings		52500
		(To close drawings account)