The schedule at the top of the opposite page presents the trial balance for Sigma Consultants Corporation on December 31, 20x7. The following information is also available:

a. Ending inventory of office supplies, $86.

b. Prepaid rent expired, $700.

c. Depreciation of office equipment for the period, $600.

d. Interest accrued on the note payable, $600.

e. Salaries accrued at the end of the period, $200.

f. Service revenue still unearned at the end of the period, $1,410.

g. Service revenue earned but not billed, $600.

h. Estimated federal income taxes for the period, $3,000.

Required 1. Open T accounts for the accounts in the trial balance plus the following:

Interest Payable; Salaries Payable; Income Taxes Payable; Office Supplies Expense; Depreciation Expense–Office Equipment; Interest Expense; and Income Taxes Expense. Enter the account balances.

2. Determine the adjusting entries and post them directly to the T accounts.

3. Prepare an adjusted trial balance.

4. User insight: What financial statements do each of the above adjustments affect? What financial statement is not affected by the adjustments?

Transcribed Image Text:

Cash Accounts Receivable Sigma Consultants Corporation Trial Balance December 31, 20x7 $ 12,786 24,840 Office Supplies 991 Prepaid Rent 1,400 Office Equipment 6,700 Accumulated Depreciation-Office Equipment $ 1,600 Accounts Payable 1,820 Notes Payable 10,000 Unearned Service Revenue 2,860 Common Stock 10,000 Retained Earnings 19,387 Dividends 15,000 Service Revenue 58,500 Salaries Expense 33,000 Utilities Expense 1,750 Rent Expense 7,700 $104,167 $104,167