ACC 205 Week 2 Assignment: Chapter 3 – P3-32A P3-32AJournalizing adjusting entries [15–25 min] Laughter Landscaping has the following independent cases at the end of the year on December 31, 2014. a. Each Friday, Laughter pays employees for the current week’s work. The amount of the weekly payroll is $7,000 for a five-day workweek. This year December 31 falls on a Wednesday. b. Details of Prepaid insurance are shown in the account: Prepaid insurance Jan 1 $4,500 Laughter prepays a full year’s insurance each year on January 1. Record insurance expense for the year ended December 31. c. The beginning balance of Supplies was $4,000. During the year, Laughter purchased supplies for $5,200, and at December 31 the supplies on hand total $2,400. d. Laughter designed a landscape plan, and the client paid Laughter $7,000 at the start of the project. Laughter recorded this amount as Unearned service revenue. The job will take several months to complete, and Laughter estimates that the company has earned 60% of the total revenue during the current year. e. Depreciation for the current year includes Equipment, $3,700; and Trucks, $1,300. Make a compound entry. Requirement 1. Journalize the adjusting entry needed on December 31, 2014, for each of the previous items affecting Laughter Landscaping. Chapter 3 – P3-33A P3-33A Analyzing and journalizing adjustments [15–20 min] Galant Theater Production Company unadjusted and adjusted trial balances at December 31, 2012, follow. GALANT THEATER PRODUCTION COMPANY Adjusted Trial Balance December 31, 2012 GALANT THEATER PRODUCTION COMPANY Adjusted Trial Balance December 31, 2012 GALANT THEATER PRODUCTION COMPANY Adjusted Trial Balance December 31, 2012 GALANT THEATER PRODUCTION COMPANY Adjusted Trial Balance December 31, 2012 GALANT THEATER PRODUCTION COMPANY Adjusted Trial Balance December 31, 2012 Trial Balance Trial Balance Adjusted Trial Balance Adjusted Trial Balance Adjusted Trial Balance Account Debit Credit Debit Credit Credit Cash $3,900 $3,900 Accounts Receivable 6,100 6,900 Supplies Prepaid Insurance Equipment Accumulated Depreciation Accounts Payable 4,000 4,000 4,000 Salary Payable 300 300 Galant, Capital 20,300 20,300 20,300 Galant, Drawing 30,500 30,500 Service Revenue 71,000 71,800 71,800 Depreciation Expense 4,400 Supplies Expense 1,400 Utilities Expense 4,700 4,700 Salary Expense 29,500 29,800 Insurance Expense 600 Total 104,100 104,100 109,600 109,600 109,600 GALANT THEATER PRODUCTION COMPANY Adjusted Trial Balance 31-Dec-12 Requirement 1. Journalize the adjusting entries that account for the differences between the two trial balances. Chapter 4 – E4-21 E4-21 Identifying and journalizing closing entries [10-15 min] The accountant for Klein Photography has posted adjusting entries (a)–(e) to the following selected accounts at December 31, 2012. Requirements 1. Journalize Klein Photography’s closing entries at December 31, 2012. 2. Determine Klein Photography’s ending Retained earnings balance at December 31, 2012. Accounts Receivable Supplies___ 46,000 5,000 2,400 2,000 Accumulated Depr. – Furniture Accumulated Depr. – Building 8,000 30,000 800 6,200 Salary Payable Klein, Capital 700 47,000 Klein, Drawing Service Revenue 57,000 108,000 2,000 Salary Expense Supplies Expense 25,400 2,400 700 Depreciation Expense-Furniture Depreciation Expense-Building 800 6,200 Chapter 4 – P4-25A P4-25A Preparing a worksheet, financial statements, and closing entries [50-60 min] The trial balance of Fugazy Investment Advisers, Inc., at December 31, 2012, follows: FUGAZY INVESTMENT ADVISERS, INC. Trial Balance 31-Dec-12 Account Debit Credit Cash $32,000 Accounts receivable 46,000 Supplies 3,000 Equipment 25,000 Accumulated depreciation $11,000 Accounts payable 15,000 Salary payable Unearned service revenue 2,000 Note payable, long-term 39,000 Common stock 17,600 Retained earnings 20,400 Dividends 50,000 Service revenue 97,000 Salary expense 32,000 Supplies expense Depreciation expense Interest expense 3,000 Rent expense 9,000 Insurance expense 2,000 Total $202,000 $202,000 Requirements 1. Enter the account data in the Trial Balance columns of a worksheet, and complete the worksheet through the Adjusted Trial Balance. Key each adjusting entry by the letter corresponding to the data given. Leave a blank line under Service revenue. 2. Prepare the income statement, the statement of retained earnings, and the classified balance sheet in account format. 3. Prepare closing journal entries from the worksheet. 4. Did the company have a good or a bad year during 2012? Give the reason for your answer.