Tuesday 16 October 2012

Rolling Hills Golf Inc. was organized on July 1, 2012. Quarterly financial statements are prepared. The trial balance and adjusted trial balance on September 30 are shown here.

P4-4A  

 Prepare adjusting entries and financial statements; identify accounts to be closed.

(SO 4, 5, 6, 7), AP

Rolling Hills Golf Inc. was organized on July 1, 2012. Quarterly financial statements are prepared. The trial balance and adjusted trial balance on September 30 are shown here.

ROLLING HILLS GOLF INC.

Trial Balance

September 30, 2012

 

Unadjusted

Adjusted

 

Dr.

Cr.

Dr.

Cr.

Cash

$ 6,700

 

$ 6,700

 

Accounts Receivable

400

 

1,000

 

Prepaid Rent

1,800

 

900

 

Supplies

1,200

 

180

 

Equipment

15,000

 

15,000

 

Accumulated Depreciation—Equipment

 

 

 

$  350

Notes Payable

 

$ 5,000

 

5,000

Accounts Payable

 

1,070

 

1,070

Salaries and Wages Payable

 

 

 

600

Interest Payable

 

 

 

50

Unearned Rent Revenue

 

1,000

 

800

Common Stock

 

14,000

 

14,000

Retained Earnings

 

0

 

0

Dividends

600

 

600

 

Service Revenue

 

14,100

 

14,700

Rent Revenue

 

700

 

900

Salaries and Wages Expense

8,800

 

9,400

 

Rent Expense

900

 

1,800

 

Depreciation Expense

 

 

350

 

Supplies Expense

 

 

1,020

 

Utilities Expense

470

 

470

 

Interest Expense

 

 

50

 

 

$35,870

$35,870

$37,470

$37,470

Instructions

(a)  

Journalize the adjusting entries that were made.

(b)  

Prepare an income statement and a retained earnings statement for the 3 months ending September 30 and a classified balance sheet at September 30.

(b) Net income

$2,510

   Tot. assets

$23,430

 

(c)  

Identify which accounts should be closed on September 30.

(d)  

If the note bears interest at 12%, how many months has it been outstanding?

 



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