Question

33 21 Aalbo MINI ill AaBbCD AaBb CcDdl AaBbceDdl AaBbCadde Houding 3 Heading 7 Heading 101 Nomme 1,000 Alberto, Inc. December 31, 2017 Unadjusted Trial balance Cash 42,000 Accounts Receivable 24,000 Allowance for Doubtful Accounts Short Term Note Receivable 50,000 Interest Receivable 0 Supplies 5.000 Prepaid Insurance 48,000 Inventory 12,000 Vehicle 16.000 Equipment 75,000 Accumulated Depreciation Accounts Payable Uneamed Revenue Wages Payable Long-Term Notes Payable Common Stock Retained Eamings (1/1/2017) Dividends 2,000 Sales Sales Returns & Allowances 7.000 Sales Discounts 3,000 Cost of Goods Sold 46.000 Delivery Expense 5,000 Depreciation Expense 16.000 Bad Debt Expense 0 Rent Expense 98.000 Insurance Expense 25.000 Wages Expense 195.000 Supplies Expense 16.000 Interest Revenue Loss on Disposal Interest Expense 6,500 Income Tax Expense 36,000 Total 727,500 42,000 12,000 14,000 2.000 45,000 106,000 2,500 503.000 0 0 727.500 usted Trial Balance HERE: O Focus MacBook Air

Answer 1

1a.	Adjusting journal entries:
	Ref.	Account titles					Debit	Credit
	1	Accounts receivable					16500
		Sales						16500
		(Sales on account)
		Cost of goods sold					5500
		Inventory						5500
		(Cost of goods sold recorded)
	2	Interest revceivable		(50000*12%*3/12)			1500
		Interest revenue						1500
		(Interest accrued from Oct 1 to Dec 31-3 months)
	3	Allowance for doubtful accounts					1600
		Accounts receivable						1600
		(Accounts receivable written off)
	4	Bad debt expense				(Note:1)	2600
		Allowance for doubtful accounts						2600
		(Bad debt expenses recorded)
	5	Depreciation expense					3000
		Accumulated depreciation						3000
		(Depreciation recorded)
	6	Accumulated depreciation			(24000+3000)		27000
		Loss on disposal				(Plug)	7000
		Equipment						34000
		(Retirement of equipment)
	Note:1
	Allowance for doubtful accounts
	Ref.	Debit	Ref.	Credit
	3	1600	Bal.	1000
		1600		1000
	Unadj bal.	600
	Unadjusted balance on AFDA=$ 600 debit
	Estimated uncollectible accounts=$ 2000
	Bad debt expense=600+2000=$ 2600
1b.		Accounts receivable		Allowance for doubtful accounts
	Ref.	Debit	Ref.	Credit		Ref.	Debit	Ref.	Credit
	Bal.	24000	3	1600		3	1600	Bal.	1000
	1	16500						4	2600
		40500		1600			1600		3600
	Bal.	38900						Bal.	2000
		Interest receivable				Inventory
	Ref.	Debit	Ref.	Credit		Ref.	Debit	Ref.	Credit
	2	1500				Bal.	12000	1	5500
							12000		5500
						Bal.	6500

1c. December 31, 2017 Adjusted trial balance Debit Credit Cash 42000 Accounts receivable 38900 Allowance for doubtful accounts 2000 Short term note receivable 50000 Interest receivable 1500 Supplies 5000 Prepaid insurance 48000 Inventory 6500 Vehicle 160001 Equipment 41000 Accumulated depreciation 18000 Accounts payable 12000 Unearned revenue 14000 Wages payable 2000 Long-term notes payable 45000 Common stock 106000 Retained earnings (1/1/2017) 2500 Dividends 2000 Sales 519500 Sales returns & Allowances 7000 Sales discounts 3000

7000 3000 51500 5000 19000 2600 98000 Sales returns & Allowances Sales discounts Cost of goods sold Delivery expense Depreciation expense Bad debt expense Rent expense Insurance expense Wages expense Supplies expense Interest revenue Loss on disposal Interest expense Income tax expense Total 25000 195000 16000 1500 7000 65001 36000 722500 722500