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Epicenter Laundry UNADJUSTED TRIAL BALANCE June 30, 2019 ACCOUNT TITLE DEBIT CREDIT 1 Cash 11,000.00 2...

Epicenter Laundry

UNADJUSTED TRIAL BALANCE

June 30, 2019

ACCOUNT TITLE DEBIT CREDIT

1

Cash

11,000.00

2

Laundry Supplies

21,500.00

3

Prepaid Insurance

9,600.00

4

Laundry Equipment

232,600.00

5

Accumulated Depreciation

125,400.00

6

Accounts Payable

11,800.00

7

Sophie Perez, Capital

105,600.00

8

Sophie Perez, Drawing

10,000.00

9

Laundry Revenue

232,200.00

10

Wages Expense

125,200.00

11

Rent Expense

40,000.00

12

Utilities Expense

19,700.00

13

Miscellaneous Expense

5,400.00

14

Totals

475,000.00

475,000.00

The data needed to determine year-end adjustments are as follows:

Laundry supplies on hand at June 30 are $3,600.
Insurance premiums expired during the year are $5,700.
Depreciation of laundry equipment during the year is $6,500.
Wages accrued but not paid at June 30 are $1,100.

Required:

1. For each account listed in the unadjusted trial balance, enter the balance in a T account. Identify the balance as “Bal.”
2. (Optional) On your own paper or spreadsheet, enter the unadjusted trial balance on an end-of-period work sheet and complete the work sheet.
3.
a. Journalize the adjusting entries on page 10 of the journal. Adjusting entries are recorded on June 30.
b. Post the adjusting entries. In the T accounts, identify the adjustments by “Adj.” and the new balances as “Adj. Bal.” (Be sure to add a posting reference to the journal.)
4. Prepare an adjusted trial balance.
5. Prepare an income statement, a statement of owner’s equity, and a balance sheet.*
6.
a. Journalize the closing entries on page 11 of the journal.
b. Post the closing entries. In the T accounts, identify the closing entries by “Clos.” (Be sure to add a posting reference to the journal.)
7. Prepare a post-closing trial balance.

*Be sure to read the instructions for each financial statement carefully.

CHART OF ACCOUNTS
Epicenter Laundry
General Ledger
ASSETS
11 Cash
13 Laundry Supplies
14 Prepaid Insurance
16 Laundry Equipment
17 Accumulated Depreciation
LIABILITIES
21 Accounts Payable
22 Wages Payable
EQUITY
31 Sophie Perez, Capital
32 Sophie Perez, Drawing
33 Income Summary
REVENUE
41 Laundry Revenue
EXPENSES
51 Wages Expense
52 Rent Expense
53 Utilities Expense
54 Laundry Supplies Expense
55 Depreciation Expense
56 Insurance Expense
59

Miscellaneous Expense

Labels
Current assets
Current liabilities
Expenses
For the Year Ended June 30, 2019
June 30, 2019
Property, plant, and equipment
Revenues
Amount Descriptions
Decrease in owner’s equity
Increase in owner’s equity
Net income
Net loss
Sophie Perez, capital, June 30, 2019
Sophie Perez, capital, July 1, 2018
Total assets
Total current assets
Total expenses
Total liabilities
Total liabilities and owner’s equity
Total property, plant, and equipment
Withdrawals

Solutions

Expert Solution

:: Solution ::

  • All working forms part of the answer
  • Adjusting Entries

DATE

DESCRIPTION

POST. REF.

DEBIT

CREDIT

ASSETS

LIABILITIES

EQUITY

1

2

Laundry Supplies expenses

$                   17,900.00

$ (17,900.00)

3

Laundry Supplies

$               17,900.00

$           (17,900.00)

4

Insurance expenses

$                      5,700.00

$     (5,700.00)

5

Prepaid Insurance

$                 5,700.00

$              (5,700.00)

6

Depreciation Expense

$                      6,500.00

$     (6,500.00)

7

Accumulated Depreciation

$                 6,500.00

$              (6,500.00)

8

Wages Expense

$                      1,100.00

$     (1,100.00)

9

Wages payable

$                 1,100.00

$    1,100.00

  • Complete T Accounts:

Cash (Acct. 11)

Bal.

$                                         11,000.00

Laundry Supplies (Acct. 13)

Bal.

$                                         21,500.00

Adj.

$            17,900.00

Adj. Bal.

$                                           3,600.00

Prepaid Insurance (Acct. 14)

Bal.

$                                           9,600.00

Adj.

$              5,700.00

Adj. Bal.

$                                           3,900.00

Laundry Equipment (Acct. 16)

Bal.

$                                     2,32,600.00

Accumulated Depreciation (Acct. 17)

Bal.

$        1,25,400.00

Adj.

$              6,500.00

Adj. Bal.

$        1,31,900.00

Accounts Payable (Acct. 21)

Bal.

$            11,800.00

Wages Payable (Acct. 22)

Adj.

$              1,100.00

Sophie Perez, Capital (Acct. 31)

Clos.

$                                         10,000.00

Bal.

$        1,05,600.00

Clos.

$            10,700.00

Bal.

$        1,06,300.00

Sophie Perez, Drawing (Acct. 32)

Bal.

$                                         10,000.00

Clos.

$            10,000.00

Laundry Revenue (Acct. 41)

Clos.

$                                     2,32,200.00

Bal.

$        2,32,200.00

Wages Expense (Acct. 51)

Bal.

$                                     1,25,200.00

Clos.

$        2,52,600.00

Adj.

$                                           1,100.00

Adj. Bal.

$                                     1,26,300.00

Rent Expense (Acct. 52)

Bal.

$                                         40,000.00

Clos.

$            40,000.00

Utilities Expense (Acct. 53)

Bal.

$                                         19,700.00

Clos.

$            19,700.00

Laundry Supplies Expense (Acct. 54)

Adj.

$                                         17,900.00

Clos.

$            17,900.00

Depreciation Expense (Acct. 55)

Adj.

$                                           6,500.00

Clos.

$              6,500.00

Insurance Expense (Acct. 56)

Adj.

$                                           5,700.00

Clos.

$              5,700.00

Miscellaneous Expense (Acct. 59)

Bal.

$                                5,400.00

Clos.

$              5,400.00

  • Adjusted Trial balance

June 30, 2019

ACCOUNT TITLE

DEBIT

CREDIT

1

Cash

$             11,000.00

2

Laundry Supplies

$               3,600.00

3

Prepaid Insurance

$               3,900.00

4

Laundry Equipment

$         2,32,600.00

5

Accumulated Depreciation

$             1,31,900.00

6

Accounts Payable

$                11,800.00

7

Wages Payable

$                   1,100.00

8

Sophie Perez, Capital

$             1,05,600.00

9

Sophie Perez, Drawing

$             10,000.00

10

Laundry Revenue

$             2,32,200.00

11

Wages Expense

$         1,26,300.00

12

Rent Expense

$             40,000.00

13

Utilities Expense

$             19,700.00

14

Laundry Supplies Expense

$             17,900.00

15

Depreciation Expense

$               6,500.00

16

Insurance Expense

$               5,700.00

17

Miscellaneous Expense

$               5,400.00

18

Totals

$         4,82,600.00

$             4,82,600.00

* INCOME STATEMENT

* Statement of Owner's Equity

* Balance Sheet

  • Closing Entries

DESCRIPTION

DEBIT

CREDIT

Laundry Revenue

$             2,32,200.00

Income Summary

$                2,32,200.00

(revenue account closed)

Income Summary

$             2,21,500.00

Wages Expense

$                1,26,300.00

Rent Expense

$                   40,000.00

Utilities Expense

$                   19,700.00

Laundry Supplies Expense

$                   17,900.00

Depreciation Expense

$                      6,500.00

Insurance Expense

$                      5,700.00

Miscellaneous Expense

$                      5,400.00

(expenses account closed)

Income Summary

$                 10,700.00

Sophie Perez Capital

$                   10,700.00

(Net income closed)

Sophie Perez Capital

$                 10,000.00

Sophie Perez, Drawing

$                   10,000.00

(drawings closed)

  • Post Closing Trial Balance

June 30, 2019

ACCOUNT TITLE

DEBIT

CREDIT

1

Cash

$                     11,000.00

2

Laundry Supplies

$                       3,600.00

3

Prepaid Insurance

$                       3,900.00

4

Laundry Equipment

$                 2,32,600.00

5

Accumulated Depreciation

$        1,31,900.00

6

Accounts Payable

$            11,800.00

7

Wages Payable

$              1,100.00

8

Sophie Perez, Capital

$        1,06,300.00

9

Totals

$                 2,51,100.00

$        2,51,100.00


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