Question

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Brothers Harry and Herman Hausyerday began operations of their machine shop (H & H Tool, Inc.) on January 1, 2016. The annual reporting period ends December 31. The trial balance on January 1, 2018, follows (the amounts are rounded to thousands of dollars to simplify):

Account Titles	Debit			Credit
Cash	$	3
Accounts Receivable		5
Supplies		12
Land		0
Equipment		58
Accumulated Depreciation				$	6
Software		16
Accumulated Amortization					7
Accounts Payable					5
Notes Payable (short-term)					0
Salaries and Wages Payable					0
Interest Payable					0
Income Tax Payable					0
Common Stock					68
Retained Earnings					8
Service Revenue		0
Salaries and Wages Expense		0
Depreciation Expense		0
Amortization Expense		0
Income Tax Expense		0
Interest Expense		0
Supplies Expense		0
Totals	$	94		$	94

Transactions and events during 2018 (summarized in thousands of dollars) follow:

Borrowed $12 cash on March 1 using a short-term note.

Purchased land on March 2 for future building site; paid cash, $9.

Issued additional shares of common stock on April 3 for $26.

Purchased software on July 4, $10 cash.

Purchased supplies on account on October 5 for future use, $18.

Paid accounts payable on November 6, $13.

Signed a $25 service contract on November 7 to start February 1, 2019.

Recorded revenues of $156 on December 8, including $38 on credit and $118 collected in cash.

Recognized salaries and wages expense on December 9, $83 paid in cash.

Collected accounts receivable on December 10, $22.

Data for adjusting journal entries as of December 31:

Unrecorded amortization for the year on software, $7.

Supplies counted on December 31, 2018, $10.

Depreciation for the year on the equipment, $6.

Interest of $1 to accrue on notes payable.

Salaries and wages earned but not yet paid or recorded, $12.

Income tax for the year was $8. It will be paid in 2019.

Prepare an unadjusted trial balance. (Enter your answers in thousands of dollars.)

Answer 1

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Date	Account	Debit	Credit
Mar 1	Cash	$         12
	Note Payable (Short term)		$         12
Mar 2	Land	$           9
	Cash		$           9
Apr 3	Cash	$         26
	Common Stock		$         26
Jul 4	Software	$         10
	Cash		$         10
Oct 5	Supplies	$         18
	Accounts Payable		$         18
Nov 6	Accounts Payable	$         13
	Cash		$         13
Dec 8	Accounts Receivable	$         38
	Cash	$       118
	Service Revenue		$       156
Dec 9	Salaries and Wages Expense	$         83
	Cash		$         83
Dec 10	Cash	$         22
	Accounts Receivable		$         22
Adjusting Entries:
Dec 31	Amortization Expense	$           7
	Accumulated Amortization		$           7
Dec 31	Supplies Expense	$         20		12+18-10
	Supplies		$         20
Dec 31	Depreciation Expense	$           6
	Accumulated Depreciation		$           6
Dec 31	Interest Expense	$           1
	Interest Payable		$           1
Dec 31	Salaries and Wages Expense	$         12
	Salaries and Wages Payable		$         12
Dec 31	Income Tax Expense	$           8
	Income Tax Payable		$           8

	Beginning		Unadjusted		Adjustments		Adjusted Trial
Account Titles	Debit	Credit	Debit	Credit	Debit	Credit	Debit	Credit
Cash	$           3		$         63				$         66
Accounts Receivable	$           5		$         16				$         21
Supplies	$         12		$         18			$         20	$         10
Land	$          -		$           9				$           9
Equipment	$         58						$         58
Accumulated Depreciation		$           6				$           6		$         12
Software	$         16		$         10				$         26
Accumulated Amortization		$           7				$           7		$         14
Accounts Payable		$           5		$           5				$         10
Notes Payable (short-term)		$          -		$         12				$         12
Salaries and Wages Payable		$          -				$         12		$         12
Interest Payable		$          -				$           1		$           1
Income Tax Payable		$          -				$           8		$           8
Common Stock		$         68		$         26				$         94
Retained Earnings		$           8						$           8
Service Revenue	$          -			$       156				$       156
Salaries and Wages Expense	$          -		$         83		$         12		$         95
Depreciation Expense	$          -				$           6		$           6
Amortization Expense	$          -				$           7		$           7
Income Tax Expense	$          -				$           8		$           8
Interest Expense	$          -				$           1		$           1
Supplies Expense	$          -				$         20		$         20
Totals	$         94	$         94	$       199	$       199	$         54	$         54	$       327	$       327