Question

Problem 3-3A Everett Co. was organized on July 1, 2015. Quarterly financial statements are prepared. The unadjusted and adjusted trial balances as of September 30 are shown below. EVERETT CO. Trial Balance September 30, 2015 Unadjusted Adjustecd $ 8,731 11,562 655 1,150 10,396 1,545 2,160 18,260 Accounts Recevable Prepaid Rent $0 9,400 2,507 $664 9,400 2,507 712 Notes Payable Accounts Payable Salaries and Wages Payable Interest Payable Unearned Rent Revenue Common Stock 1,874 21,860 21,860 1,649 17,501 1,366 18,667 2,166 Service Revenue Rent Revenue Salaries and Wages Expense Rent Expense Depreciation Expense Supplies Expense Utilities Expense Interest Expense 8,353 1,855 9,065 2,865 1,559 1,559 $54,508 $54,508 57,144 57,144 Journalize the annual adjusting entries that were made. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Date Account Titles and Explanation Sept. 30 Debit Credit To record accrued revenue.) Sept. 30 To record prepaid rent.) Sept. 30 To record supplies used.) Sept. 30 To record depreciation.) Sept. 30 (To record interest.) Sept. 30 To record unearned rent revenue.) Sept. 30 To record accrued salaries.) Prepare an income statement for the 3 months ending September 30, 2015 EVERETT CO. Income Statement For the Quarter Ended September 30, 2015 Prepare a statement of retained earnings for the 3 months ending September 30, 2015. (List items that increase retained earnings first. EVERETT CO. Retained Earnings Statement For the Quarter Ended September 30, 2015 Prepare a balance sheet at September 30. (List assets in order of liquidity.) EVERETT CO. Balance Sheet September 30, 2015 Assets Liabilities and Stockholders' Equity If the note bears interest at 12%, how many months has it been outstanding? Note has been outstanding for month(s)

Answer 1

Date	Account Titles and Explanation	Debit	Credit
Sep-30	Accounts receivable [11562-10396]	$         1,166
	Service revenue [18667-17501]		$       1,166
	[To record accrued revenue]
Sep-30	Rent expense [2865-1855]	$         1,010
	Prepaid rent [2160-1150]		$       1,010
	[To record prepaid rent]
Sep-30	Supplies expense	$             890
	Supplies [1545-655]		$           890
	[To record supplies used]
Sep-30	Depreciation expense	$             664
	Accumulated Depreciation-Equipment [664-0]		$           664
	[To record depreciation]
Sep-30	Interest expense	$               94
	Interest payable		$             94
	[To record interest]
Sep-30	Rent Revenue [2166-1366]	$             800
	Unearned rent revenue		$           800
	[To record unearned rent revenue]
Sep-30	Salaries & Wages Expense [9065-8353]	$             712
	Salaries & Wages Payable		$           712
	[To record accrued salaries]
	INCOME STATEMENT
	Revenue:
	Service revenue	$       18,667
	Rent revenue	$         2,166
	Total revenue		$     20,833
	Expenses:
	Salaries and wages expense	$         9,065
	Rent expense	$         2,865
	Depreciation expense	$             664
	Supplies expense	$             890
	Utilities expense	$         1,559
	Interest expense	$               94
	Total expenses		$     15,137
	Net income		$       5,696
	RETAINED EARNINGS STATEMENT
	Balance as on 1st July 2015		$              -
	Add: Net income for the year		$       5,696
			$       5,696
	Less: Dividends		$       1,649
	Balance as on 30th September 2015		$       4,047
	BALANCE SHEET
	Assets
	Current assets:
	Cash	$         8,731
	Accounts receivable	$       11,562
	Supplies	$             655
	Prepaid rent	$         1,150
	Total current assets		$     22,098
	Non-Current assets:
	Equipment	$       18,260
	Accumulated depreciation	$             664
	Total non current assets		$     17,596
	Total assets		$     39,694
	Liabilities and Stockholders' Equity
	Current liabilities:
	Accounts payable	$         2,507
	Salaries and wages payable	$             712
	Interest payable	$               94
	Unearned rent revenue	$         1,074
	Total current liabilities		$       4,387
	Non-Current liabilities:
	Notes payable		$       9,400
	Total liabilities		$     13,787
	Stockholders' equity:
	Common stock	$       21,860
	Retained earnings	$         4,047
	Total stockholders' equity		$     25,907
	Total liabilities and stockholders' equity		$     39,694
	Notes payable:
	Has been outstanding for 1 month.
	Interest expense = $94
	Number of months = ((94/(9400*12%))*12 =	1.00	month

Answer 2

Answer for questions a d c