Question

The unadjusted trial balance of Epicenter Laundry at June 30, 2016, the end of the fiscal year, follows:

Epicenter Laundry

UNADJUSTED TRIAL BALANCE

June 30, 2016

	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	Wages Payable
8	Common Stock		40,000.00
9	Retained Earnings		65,600.00
10	Dividends	10,000.00
11	Income Summary
12	Laundry Revenue		232,200.00
13	Wages Expense	125,200.00
14	Rent Expense	40,000.00
15	Utilities Expense	19,700.00
16	Laundry Supplies Expense
17	Depreciation Expense
18	Insurance Expense
19	Miscellaneous Expense	5,400.00
20	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. 5. a. Prepare an income statement for the year ended June 30, 2016. If a net loss has been incurred, enter that amount as a negative number using a minus sign. Be sure to complete the statement heading. Use the list of Labels and Amount Descriptions for the correct wording of text items other than account names. You will not need to enter colons (:) on the income statement. 5. b. Prepare a retained earnings statement for the year ended June 30, 2016. If a net loss has been incurred or there has been a decrease in retained earnings, enter that amount as a negative number using a minus sign. Be sure to complete the statement heading. Use the list of Labels and Amount Descriptions for the correct wording of text items. 5. c. Prepare a balance sheet as of June 30, 2016. Fixed assets must be entered in order according to account number. Be sure to complete the statement heading. Use the list of Labels and Amount Descriptions for the correct wording of text items other account names. You will not need to enter colons (:) or the word "Less" on the balance sheet; they will automatically insert where necessary. 6. a. Journalize the closing entries on page 11 of the journal. (Note: Complete the adjusted trial balance, the income statement, the retained earnings statement, and the balance sheet BEFORE completing part 6. a.)

Answer 1

Adjusting entries:
1	laundry Supplies expense Account Dr.				17900
	laundry Supplies Account					17900
2	Insurance ExpenSe Aaccount Dr.				5700
	Prepaid insurance					5700
3	Depreciatin expensne Account Dr.				6500
	Accumulated depreciation					6500
4	Wages expense Account Dr.				1100
	Wages payable					1100
ADJUSTED TRIAL BALANCE
30.06.2016
						Debit $	Credit $
Cash						11000
Prepaid Insurance						3900
Supplies						3600
Laundry Equipment						232600
Accumulated Depreciation							131900
Accounts Payable							11800
Wages payable							1100
Common Stock							40000
Retained earnings							65600
Dividend						10000
Income Ssummary
laundry revenue							232200
Wages expense						126300
rent expense						40000
utilities expense						19700
Laundry supplies expense						17900
Depreciation expense						6500
Insurance expense						5700
Misc expense						5400
				TOTAL		482600	482600
STATEMENT OF INCOME
							Amount $
Laundry revenue							232,200
Less: Operating expense
	Wages expense			126300
	rent expense			40000
	utilities expense			19,700
	Laundry supplies expense			17,900
	Depreciation expense			6,500
	Insurance expense			5,700
	Misc expense			5,400			221,500
Net Income Earned							10,700
STATEMENT OF RETAINED EARNINGS
							Amount $
Beginnign balance							65,600
Less: Dividend							10,000
Add: Net income earned							10,700
Ending balance							66,300
BALANCE SHEET
							Amount $
ASSETS:
Current Assets:
	Cash					11,000
	laundry supplies					3,600
	Prepaid Insurance					3,900	18,500
Fixed Assets:
	Equipment					232,600
	Less: Accumulated Dep					131,900	100,700
				TOTAL ASSETS			119,200
LIABILITIES:
Current Liabilities:
	Accounst Payable					11,800
	Wages payable					1,100	12,900
Stockholder equity
	Common Stock					40000
	Retained earnings					66300	106,300
				TOTAL LIABILITIES			119,200
CLOSING ENTRIES:
1	Laundry revenue				232200
	Income Summary					232200
2	Income Summary Account Dr.				221500
		Wages expense				126300
		rent expense				40000
		utilities expense				19700
		Laundry supplies expense				17900
		Depreciation expense				6500
		Insurance expense				5700
		Misc expense				5400
3	Income Summary Account Dr.				10700
	Retained earnings					10700
4	Retained earnings Account Dr.				10000
	Dividend					10000