P3-64A. (Learning Objectives 3, 4: Preparing an adjusted trial balance and the financial statements) Consider the unadjusted trial balance of Moscow, Inc., at December 31, 20X6, and the related month-end adjustment data.

Adjustment data December 31, 20X6:

a. Accrued service revenue at December 31, $2,200.

b. Prepaid rent expired during the month. The unadjusted prepaid balance of $2,400 relates to the period December 1, 20X6, through February, 20X7.

c. Supplies used during December, $2,100.

d. Depreciation on furniture for the month. The estimated useful life of the furniture is three years.

e. Accrued salary expense at December 31 for Monday, Tuesday, and Wednesday. The five-day weekly payroll of $5,000 will be paid on Friday.
Requirements 1. Using Exhibit 3-9 as an example, prepare the adjusted trial balance of Moscow, Inc., at December 31, 20X6. Key each adjusting entry by letter.
2. Prepare the monthly Income Statement, the statement of changes in equity, and the classified Balance Sheet. Draw arrows linking the three statements.

Transcribed Image Text:

A1 Moscow, Inc. Trial Balance Worksheet December 31, 20X6 D 1 2 Trial Balance 3 Account Debit Credit Debit Adjustments Credit Adjusted Trial Balance Debit Credit 4 Cash 8,900 5 Accounts receivable 1,300 6 Prepaid rent 2,400 7 Supplies 2,600 8 Furniture 72,000 9 Accumulated depreciation 4,000 10 Accounts payable 3,400 11 Salary payable 12 Share capital 12,000 13 Retained earnings 63,250 14 Dividends 3,600 15 Service revenue 11,200 16 Salary expense 2,400 17 Rent expense 18 Utilities expense 650 19 Depreciation expense 20 Supplies expense 21 Total 93,850 93,850 22