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Bug - Off Exterminators provides pest control services and sells extermination products manufactured by other companies. Following is the company's unadjusted trial balance as of
BugOff Exterminators provides pest control services and sells extermination products manufactured by other companies. Following is the company's unadjusted trial balance as of December
December
Unadjusted Trial Balance
Debit Credit
Cash $
Accounts receivable
Allowance for doubtful accounts $
Merchandise inventory
Trucks
Accumulated depreciationTrucks
Equipment
Accumulated depreciationEquipment
Accounts payable
Estimated warranty liability
Unearned services revenue
Interest payable
Longterm notes payable
Common stock
Retained earnings
Dividends
Extermination services revenue
Interest revenue
Sales of merchandise
Cost of goods sold
Depreciation expenseTrucks
Depreciation expenseEquipment
Wages expense
Interest expense
Rent expense
Bad debts expense
Miscellaneous expense
Repairs expense
Utilities expense
Warranty expense
Totals $ $
The following information in a through h applies to the company at the end of the current year.
The bank reconciliation as of December includes the following facts.
Cash balance per bank $
Cash balance per books
Outstanding checks
Deposit in transit
Interest earned on bank account
Bank service charges miscellaneous expense
Reported on the bank statement is a canceled check that the company failed to record. Information from the bank reconciliation allows you to determine the amount of this check, which is a payment on an account payable.
An examination of customers accounts shows that accounts totaling $ should be written off as uncollectible. Using an aging of receivables, the company determines that the ending balance of the Allowance for Doubtful Accounts should be $
A truck is purchased and placed in service on January Its cost is being depreciated with the straightline method using the following facts and estimates.
Original cost $
Expected salvage value $
Useful life years
Two items of equipment a sprayer and an injector were purchased and put into service in early January They are being depreciated with the straightline method using these facts and estimates.
Sprayer Injector
Original cost $ $
Expected salvage value $ $
Useful life years
On September the company is paid $ cash in advance to provide monthly service for an apartment complex for one year. The company began providing the services in September. When the cash was received, the full amount was credited to the Extermination Services Revenue account.
The company offers a warranty for the services it sells. The expected cost of providing warranty service is of the extermination services revenue of $ for No warranty expense has been recorded for All costs of servicing warranties in were properly debited to the Estimated Warranty Liability account.
The $ longterm note is an fiveyear, interestbearing note with interest payable annually on December The note was signed with First National Bank on December
The ending inventory of merchandise is counted and determined to have a cost of $ BugOff uses a perpetual inventory system.
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