Financial and Managerial Accounting: P3-42B The unadjusted trial balance of Alston Air Purification

Financial and Managerial Accounting 
The unadjusted trial balance of Alston Air Purification System at December 31, 2016, and the data needed for the adjustments follow.  
Unadjusted Trial Balance 
December 31, 2014 
Account Title Balance 
   Debit Credit 
Cash 7,400    
Accounts   Receivable 19,300    
Prepaid   Rent 2,700    
Office   Supplies 1,100 
Equipment 20,000    
Accumulated   Depreciation Equipment    4,000 
Accounts   Payable    3,100 
Salaries   Payable       
Unearned   Revenue    2,600 
Alston,   Capital    40,100 
Alston, Withdrawals 9,900    
Service   Revenue    15,400 
Salaries   Expense 3,400    
Rent Expense       
Depreciation Expense -Equipment       
Advertising Expense 1,400    
Supplies Expense 
Total $65,200 $65,200 

Adjustment data at December 31 follow:  
a. On December 15, Alston contracted to perform services for a client receiving $2,600 in advance. Alston recorded this receipt of cash as Unearned Revenue. As of December 31, Alston has completed $ 1,200 of the services.  
b. Alston prepaid two months of rent on December 1.  
c. Alston used $650 of office supplies during the month.  
d. Depreciation for the equipment is $500.  
e. Alston received a bill for Decembers online advertising, $600. Alston will not pay the bill until January. (Use Accounts Payable.)  
f. Alston pays its employees weekly on Monday for the previous week’s wages. Its employees earn $5,500 for a five-day workweek. December 31 falls on Wednesday this year.  
g. On October 1, Alston agreed to provide a four-month air system check (beginning October 1) for a customer for $2,800. Alston has completed the system check every month, but payment has not yet been received and no entries have been made.  

1. Journalize the adjusting entries on December 31.  
2. Using the unadjusted trial balance, open the T-accounts with the unadjusted balances. Post the adjusting entries to the T-accounts.  
3. Prepare the adjusted trial balance.  
4. How will Alston Air Purification System use the adjusted trial balance?
Powered by