P4-7 (Algo) Recording Adjusting and Closing Entries and Preparing a Balance Sheet and Income Statement Including Earnings per Share LO4-1, 4-2, 4-4
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Tunstall, Inc., a small service company, keeps its records
without the help of an accountant. After much effort, an outside
accountant prepared the following unadjusted trial balance as of
the end of the annual accounting period on December 31:
Tunstall, Inc. Unadjusted Trial Balance for the Year Ended December 31 |
||||||||
Debit | Credit | |||||||
Cash | 47,400 | |||||||
Accounts receivable | 10,600 | |||||||
Supplies | 500 | |||||||
Prepaid insurance | 640 | |||||||
Service trucks | 16,600 | |||||||
Accumulated depreciation | 9,000 | |||||||
Other assets | 9,660 | |||||||
Accounts payable | 2,240 | |||||||
Wages payable | ||||||||
Income taxes payable | ||||||||
Note payable (3 years; 10% interest due each December 31) |
13,000 | |||||||
Common stock (5,000 shares outstanding) | 1,996 | |||||||
Additional paid-in capital | 17,964 | |||||||
Retained earnings | 5,800 | |||||||
Service revenue | 84,940 | |||||||
Wages expense | 16,200 | |||||||
Remaining expenses (not detailed; excludes income tax) |
33,340 | |||||||
Income tax expense | ||||||||
Totals | 134,940 | 134,940 | ||||||
Data not yet recorded at December 31 included:
P4-7 Part 1
Required:
1. Record the adjusting entries. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
Debit | Credit | |||
a | Supplies expense | 360 | =500-140 | |
Supplies | 360 | |||
b | Insurance expense | 640 | ||
Prepaid insurance | 640 | |||
c | Depreciation expense | 4200 | ||
Accumulated depreciation | 4200 | |||
d | Wages expense | 670 | ||
Wages payable | 670 | |||
e | Income taxes expense | 5680 | ||
Income taxes payable | 5680 |
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