Playland operates a miniature golf course on rented land within a city park. Fol- lowing is the company’s adjusted tria! balance at December 31, 1994. The company closes its accounts at the end of each calendar year. | / , Adjusted Trial Balance. , Accumulated depreciati ' Advertising expense... _ Salaries expense ., Light & power expense .. ‘ INSTRUCTIONS PROBLEM gA.g Preparing Closing Entries _ Salaries Payabie., * PART ONE / THE ACCOUNTING CYCLE renee _ Adjusted Trial Balance _ December 31, 1994 Cash COC e eee eee eee eerste ees Accounts receivable Buildings ..... : See eweresesee eases er ene eeeseasss $ 13,500 ng «mpussadudawswaadas tSbenecs ck.2 ‘2,800 ’ Stet e ete eesseeenebecsseseeressens ‘60,000 Accumulated depreciation: DUIIGINGS 6... ete ceseieeseesseccees. Golf course structures.........,....... ‘ On: golf course structures .........0..0..... . 30,000 Accounts payable . ve . 1 SO CET COR et eeceweseasmeczensecee Oe ete h eee er crete seces Lynn George, drawing tee ee ete ace ceeenans 25,000 Admissions revenue . Seer tesee essen TR teh ese seseuopeuses Rent expense Sess ees ae i Repairs expense ... TER ON OTST Re ete e ae eeé we oe euueccens 15,000 : Tose beneavavtweseeeieends 36,000 sca ees’ HSAetrvetnedetaead ieee sivine wei -§,200° 79,000 theta ahs steeccwecg c, . 4,500 buildings ... tte eaee eee Senne wecenncscce 6,000 golf course structures : Send ecesceneusag oe Stee oee Ow EN ERR SG ew eeccanens Depreciation expense: Depreciation expense: $9 are a NOSES OSs ecses sens _ 15,000 — a Prepare an i - nded Dece b Prepare a neome statement and a statement of owner’s equity for the year : | mber.31, 1994. | bs balance sheet (in report form) as of December 31, 1994, |ge ee ee ee ee eT a er een oan nari ar _. revenue but expenses increased to $200,000. Assuming that the reve . count and all the expense accounts had been closed into the Income Sane ae . account at December 31, prepare a journal entry to close the Income Sumne ; account. an mary Missions : we gh Saal PpOBLEM 346 ~ The operations of Sunset Realty consist of obtaining listings of houses being offered end-of-Period for sale by owners, advertising these houses, and showing them to prospective djusting and = buyers, The company earns revenue in the form of commissions. The building and said effice equipment used in the business-were acquired on January 1 of the current. 2 Finencial _. year and were immediately placed in use. Useful life of the building was estimated: aatements. _& be 30 years and that of the office equipment 5 years. The company closes its _ accounts monthly;.on March 31 of the current year, the trial balance is as follows: ‘ 7 . . x = : ad . ECHAPTER 7 / MEASURING BUSINESS INCOME BB 149 ‘ SUNSET REALTY Trial Balance March 21, 19__ . Debit Credit COM seecversereerreeesessesosssssssrtessseessteseseeessesesss.,,, § 6,500 OE OM esas sssnisvniinsshinenessiaanvuxacancn,,,,,, 5,000 URGE TRS bose 0e0e 28,000 LOND sc sececesesecesssccesscssresssescecseceecsee, | BUNGING: «i002 veivccsrssecorccsssersscevorrersesroeotecs.,,,,,, 72,000 Accumulated depreciation: building ...................... bev. osoms $ 400 | QMO OUPMON .... 0. serecesesecrrecccsrsserorereescseessoesss,., +00 : Accumulated depreciation: office equipment pebndiedsAdeKtoererennne me Notes payable Crene ceabeaceeecescecee ee eeeeetneeneeneenners / 10,000 Cet) ACCOURRS PAYADIO oo... elie ec eccecececcececoseecneeeece a -' " ”" " Eiten Norton, capital...:........ piinanianlaNNiKeT bee ramedindelan “ “4? Ellen Norton, drawing ee cede eneeeeeeeraee een 2,006 20,000 Commissions earned .......05+.4. POPP HT PHOEBE HE SE eaeaaaeeeee 900 Dede ee a cmetnneeriieermessrieaie ee 700 Glatanempman Ce Ot ae ilenane ner a Telephone OXPONGO ... 0000 20recescersrseenes a oe From the tril balance and supplementary data given prepare the following s of ‘March 31, 19. Be aF p0s | March of and of office equip- “iia Adjusting entries for depreciation during March of building “a | | = one month's depreciation) Benet 24000 coe years xb one none cepreceton 8 eee eee a statement of owner's equity for the month of March, ~ . - @ Income and a balance sheet at March 31 in report form re _d Closing entries / -‘fully. BERS Ob PLAT IN the Closing entries? Explain . pacean — _ _ Celebrity Caterers closes its accounts and prepares financial stateraents at the end 2 clal grr Lf ofeach calendar year.: The following adjusted trial balance was a _”, Hancisl State,” ber-31 of the most'recent year, een ed at Decem- . = GT . hee CELEBRITY CATERERS Me a re Oe Ue _ Adjusted Trial Balance sce ia ee Se | December 31, 19. a ae * mex ae S Cas} ; Teiece's eR ee te ee be cinstede's dnb ueaesenive bevede dtenlecebiefecssacas, $ ‘7,300 Notes receivable Ven ecacacesivenipsvcecsice cece iowa se : 6,000 ; : a SPRS SS ees eeseseese 7 . nea te he = Accounts receivable ve eween niveles rr tseee SSintiee wees ®@eeneseeaes e 12,800 : a ae , a = “ < LAND veo eeesseneevencecesivens even situed nehlecigindls dase’ etewved ap 80:0s 0 140,000 - FEE oP gt, , MMM core yorkie ai ixnmoitwliie alanis ines dtd tukas,. veeeicuerenes 90,000 6 | s Ageumulated depreciation: ullding ....4...000¢ce.cacececseeeesen., —. . $ 42,000. fate ES ~ Office equipment 0.0.6. occacee cues cuesescaetacecsecessenee ot 4,000— . . | Accumulated depreciation; office equipment....c...,ecsesceeceees 4,600 tee Ee Notes payable ooo. cece ccigcan ti cayd sicuninarcugecscavcesesssevices fs, Ys 100,000 J"... Aecounts payable ae sm hee a acl oi na tcicchcd one ee 16,200 ~ Halley St. dames, capital... c....ceccccauececusesscuedeccuccucecees -* 132,300 on ‘Halley St. James, drawing occseecccseccuseienscesencesenceuee we aie : 24,000 Pee GMLOFING POVENUE cos cniceneseeceepenusaecqeusbeneecasertasesaneade (0 Me de Advartishng OXPONSO 6.0 o.heceececscenesesaqesegeeeapdeeesesioaebees 12,500 7 i hb 68 otf obs ANOOINICE ONPONGS sevaieverrcevedensutpereedsacerquseddersatunacdl, 6 ey 615 yee cy sein UANOOS ONPENGOS co, hacen sea seb sided Ee eedetenetenpericigeaes 8 | ree Salarles Oxpense .....ececeseseestnceseteereessvensbasenseninasens 7 . - "| Depreciation expense: DUIIGING «ss sesereesenpeeeerevenenenerenseees _ | Depreciation expense: office equipment ....e.rsserserevesaseenaees d !154 aa en am ten er man PART ONE / THE ACCOUNTING CYCLE INSTRUCTIONS a Prepare an income statement and a statement of owner’s equity for the year PROBLEM 38-6 End-of-Period Adjusting and Closing Proce- dures; Prepar- ing Financial Statements ended December 31, and a balance sheet in report form as of December 31. b Prepare closing entries at December 31. Use four entries as illustrated on pages 125-128. oO | | © . Home Repair Club is a new business which began operations on July 1. The com- pany follows a policy of closing its accounts and preparing financial statements at the end of each month. A trial balance at September 30 appears below. HOME REPAIR CLUB. 7 Trial Balance i. op _ September 30,19 = Bale « coScoabeoni ll Bremwem acbatdstemenrataaistee *s : | wa i . - Accounts recelvable .......0.ccscccecceeseuccceecce: seetencseseenee § 0 TE a i ee ee] ’ Bliclinnihiss tin siesien vies tw tahiti ca an bedtiniwe's Tee eee es eer erro merars ; __ 29,400 Accumulated depreciation: building ......<. meets ae EE eT 50,400 Repair equipment (tiv 0d now gus eee nn TTC Se Reet neeentastesaes ; $ 336 Accumulated depreciation: repair Squlpment:,;. ne 7,500 Notes payable...........,. tt ‘ Poem e eevee tenererenserees S , 250 Accounts payable 14 CES « MITTS A SOMES ON e Soe eebae eee icenseredss « . . Paul Morgan, capital... TST sete tateensceneesss ) 28,000 Paul Morgan, drawin Pere’ ree etek Ee Shae ae cab iwladedeees — ™ 1a Repair service revenye .. POORER eden ib eS uy pe eee | 58,800 Advertising expense .. OE el 6 salad oa ys iit. ‘1,400 ' re... _ is 2%. § © :6:8 6:85 os Peta tte nes a ee. pean