Ortega Security Service began operations on January 1, 1998. At the end of the Prepare adjusting entries,
Question:
Ortega Security Service began operations on January 1, 1998. At the end of the Prepare adjusting entries, first year of operations, this is the trial balance before adjustment:
Other data:
1. Service revenue earned but unbilled is \(\$ 1,500\) at December 31.
2. Insurance coverage began on January 1 under a 2-year policy.
3. Automobile depreciation is \(\$ 15,000\) for the year.
4. Interest of \(\$ 5,400\) accrued on notes payable for the year.
5. \(\$ 1,000\) of the unearned service revenue has been earned.
6. Drivers' salaries total \(\$ 500\) per day. At December 31, 4 days' salaries are unpaid.
7. Repairs to automobiles of \(\$ 650\) have been incurred, but bills have not been received prior to December 31. (Use Accounts Payable.)
\section*{Instructions}
(a) Journalize the annual adjusting entries at December 31, 1998
(b) Prepare a ledger using \(\mathrm{T}\) accounts. Enter the trial balance amounts and post the adjusting entries.
(c) Prepare an adjusted trial balance at December 31, 1998.
Step by Step Answer:
Financial Accounting Tools For Business Decision Making
ISBN: 9780471169192
1st Edition
Authors: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso