Wolf Creek Golf Inc. was organized on July 1, 2014. Quarterly financial statements are prepared. The trial balance and adjusted trial balance on September 30 are shown here.

WOLF CREEK GOLF INC.

Trial Balance September 30, 2014 Unadjusted Adjusted Dr. Cr. Dr. Cr.

Cash $ 6,700 $ 6,700 Accounts Receivable 400 1,000 Supplies 1,200 180 Prepaid Rent 1,800 900 Equipment 15,000 15,000 Accumulated Depreciation—Equipment $ 350 Notes Payable $ 5,000 5,000 Accounts Payable 1,070 1,070 Salaries and Wages Payable 600 Interest Payable 50 Unearned Rent Revenue 1,000 800 Common Stock 14,000 14,000 Retained Earnings 0 0 Dividends 600 600 Service Revenue 14,100 14,700 Rent Revenue 700 900 Salaries and Wages Expense 8,800 9,400 Rent Expense 900 1,800 Depreciation Expense 350 Supplies Expense 1,020 Utilities Expense 470 470 Interest Expense 50

$35,870 $35,870 $37,470 $37,470 Instructions

(a) Journalize the adjusting entries that were made.

(b) Prepare an income statement and a retained earnings statement for the 3 months ending September 30 and a classified balance sheet at September 30.

(c) Identify which accounts should be closed on September 30.

(d) If the note bears interest at 12%, how many months has it been outstanding?

AppendixLO1