Gibson Company’s adjusted balances at December 31, 2018 (listed alphabetically), were:

Gibson prepared, but did not yet post, additional adjusting journal entries (AJEs) for $3,000 of depreciation and $26,200 of income taxes incurred but not yet paid.

Required:

1. Post the two AJEs, determine the new adjusted balances, and prepare an adjusted trial balance listing the accounts in proper order at December 31, 2018. Solve for the “?” in Retained Earnings.

2. Does the Retained Earnings balance determined in requirement 1 represent the balance at December 31, 2018, or December 31, 2017? Explain.

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Notes Payable (long-term) Salaries and Wages Expense Accounts Payable Depreciation Expense 86,830 160,000 1,590,000 Office Expenses Accounts Receivable Equipment Service Revenue 632,250 225,400 323,040 2,564.200 Accumulated Depreciation Income Tax Expense Prepaid Rent Supplies 18,100 10.200 12.200 Rent Expense Supplies Expense Income Tax Payable Cash 152.080 42,590 178,000 2,030 Interest Expense Retained Earnings Utilities Expense Common Stock 17,200 25,230 233,370 Deferred Revenue Land 60,000 32,500