Josh Stein started his own consulting firm, Astromech Consulting, on June 1, 2007. The trial balance at June 30 is as follows.

ASTROMECH CONSULTING Trial Balance June 30, 2007 Debit Credit Cash $ 6,850 Accounts Receivable 7,000 Prepaid Insurance 2,640 Supplies 2,000 Office Equipment 15,000 Accounts Payable $ 4,540 Unearned Service Revenue 5,200 Common Stock 21,750 Service Revenue 8,000 Salaries Expense 4,000 Rent Expense 2,000

$39,490 $39,490 Problems: Set A 199 Prepare financial statements from adjusted trial balance.

(SO 6)

Prepare closing entries.

(SO 7)

Record transactions on accrual basis; convert revenue to cash receipts.

(SO 2, 4)

(b) Cash received $180,000 Prepare adjusting entries, post to ledger accounts, and prepare adjusted trial balance.

(SO 4, 5, 6}

200

(b) Service rev. $13,900

(c) Tot. trial balance $44,170 Prepare adjusting entries, adjusted trial balance, and financial statements.

(sO 4, 5,6, 7)

(c) Rent revenue $ 10,500 Tot. trial balance $114,570 CHAPTER 4 Accrual Accounting Concepts In addition to those accounts listed on the trial balance, the chart of accounts for Astromech also contains the following accounts: Accumulated Depreciation—Office Equipment, Utilities Payable, Salaries Payable, Depreciation Expense, Insurance Expense, Utilities Expense, and Supplies Expense.

Other data:

. Supplies on hand at June 30 total $980.

. A utility bill for $180 has not been recorded and will not be paid until next month.

. The insurance policy is for a year.

. $2,900 of unearned service revenue has been earned at the end of the month.

. Salaries of $1,250 are accrued at June 30.

aun PWN _ The office equipment has a 5-year life with no salvage value and is being depreciated at $250 per month for 60 months. 7. Invoices representing $3,000 of services performed during the month have not been recorded as of June 30.

Instructions

(a) Prepare the adjusting entries for the month of June.

(b) Post the adjusting entries to the ledger accounts. Enter the totals from the trial balance as beginning account balances. Use T accounts.

(c) Prepare an adjusted trial balance at June 30, 2007.