Mason Advertising Agency was founded in January 2011. Presented below are adjusted and unadjusted trial balances as of December 31, 2015.

Instructions

(a) Journalize the annual adjusting entries that were made. (Omit explanations.)

(b) Prepare an income statement and a retained earnings statement for the year ending December 31, 2015, and an unclassified statement of financial position at December 31.

(c) Answer the following questions.
(1) If the note has been outstanding 3 months, what is the annual interest rate on that note?
(2) If the company paid €12,500 in salaries in 2015, what was the balance in Salaries and Wages Payable on December 31, 2014?

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Cash Accounts Receivable Supplies Prepaid Insurance Equipment MASON ADVERTISING AGENCY TRIAL BALANCE DECEMBER 31, 2015 Accumulated Depreciation-Equipment Accounts Payable Interest Payable Notes Payable Unearned Service Revenue Salaries and Wages Payable Share Capital-Ordinary Retained Earnings Service Revenue Salaries and Wages Expense Insurance Expense Interest Expense Depreciation Expense Supplies Expense Rent Expense Unadjusted Adjusted Dr. Cr. Dr. Cr. 11,000 11,000 20,000 23,500 8,400 3,000 3,350 2,500 60,000 60,000 28,000 5,000 33,000 5,000 -0- 150 5,000 7,000 5,000 5,600 -0- 1,300 10,000 3,500 58,600 10,000 3,500 63,500 10,000 350 11,300 850 500 5,000 5,400 4,000 117,100 4,000 117,100 127,050 127,050