The accounts of Strait Alleys, showing balances as of the end of its annual accounting period, appear in the booklet of working papers that accompanies this text, and a trial balance of its ledger is reproduced on a work sheet form provided there. The trial balance has the items that follow.

\section*{Required}
1. Enter the unadjusted trial balance on a work sheet form and complete the work sheet using the information that follows.

a. Bowling supplies inventory, \(\$ 315\).

b. Expired insurance, \(\$ 1,680\).

c. Estimated depreciation on bowling equipment, \(\$ 7,125\).

d. The December electric bill for the bowling alley arrived in the mail after the trial balance was prepared. Its \(\$ 330\) amount was unrecorded.

e. Wages earned but unpaid and unrecorded, \(\$ 420\).

f. The lease contract on the building calls for an annual rent equal to \(10 \%\) of the annual bowling revenue, with \(\$ 600\) payable each month on the first day of the month. The \(\$ 600\) was paid each month and debited to the Rent Expense account.
g. Personal property taxes on the bowling equipment amounting to \(\$ 285\) have accrued but are unrecorded and unpaid.
\(h\). The long-term note payable was signed on September 1, and interest on the debt is at a \(12 \%\) annual rate or \(\$ 150\) per month. The note calls for payment in advance of \(\$ 450\) interest every three months. Interest payments were made on September 1 and December 1. A \(\$ 1,500\) payment on the note principal is due next September 1.

2. Prepare an income statement, a statement of changes in owner's equity, and a classified balance sheet. Mr. Strait did not make additional investments in the business during 1990 .
3. Journalize adjusting and closing entries.
4. Post the adjusting and closing entries and prepare a post-closing trial balance. (Omit this requirement if you are not using the working papers.)

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Cash Bowling supplies. STRAIT ALLEYS Unadjusted Trial Balance December 31, 1990 Prepaid insurance Bowling equipment. Accumulated depreciation, bowling equipment Accounts payable Long-term notes payable. Paul Strait, capital. Paul Strait, withdrawals. Bowling revenue. Wages expense Equipment repairs expense Rent expense. Utilities expense Taxes expense Interest expense. Totals $ 1,250 2,150 2,000 74,325 $ 11,460 205 15,000 31,800 23,500 81,750 24,300 630 7,200 3,200 760 900 $140,215 $140,215