1 1. Make adjusting entries in the journal (rounding to the nearest dollar) using the information below: 2. . A physical count of inventory revealed $441,020.00 of inventory 3 A physical.count of supplies revealed $7232.00 of supplies 4 Depreciation for the year was $24,005 5 The balance in prepaid rent represents an amount paid Dec. 1st for one year 6 Even though the notes receivable aren't due until April 30 2021 they will include 8% interest. The Dec. 31 balance represents a 6 month note originating on Nov. 1st 2020. 7 Dec. 31st is a Thursday and $11,000 of salaries for a five day workweek are paid every Friday. 8 2. On the designated pages, make an Adjusted Trial Balance and then Create Financial Statements for 2020 9 Additional information needed for cash flow statement (not adjusting entries): Furniture was bought for cash and equipment was bought on credit. No assets were sold. 10 Cash dividends of $50,000 were paid during the year. 11 Use the indirect method for creating the Statement of Cash Flows 12 3. Answer these questions: 13 a. How would the financial statements be different if (each of these scenerios are independent): 14 assets liabilities 15 We had missed counting incoming inventory of $1,700 16 We had forgotten to record depreciation 17 We had forgotten to count supplies 18 The bookkeeper had thought the $40,000 we received 12-1 was for past services instead of services to be performed in January 19 The bookkeper wasn't aware that the note payable includes 8% interest to be paid at maturity (calculated on the average balance) 20 (record the amount the assets, liabilities, and retained earnings would change and indicate the direction of change with a + or - 21 so that a poitive number would indicate it is too high by that amount and a negative number indicates it is too low by that amount.) 22 b. How would the financial statements be different if all of these scenerios happened in 2020? 23 24 25 26 retained earnings 1 $44,559.00 $4,690.00 $4,258.00 $459,871.00 $2,000.00 $88,331.00 ABC Inc. 2 Balance Sheet 3 1/1/2020 4 Current assets 5 Cash 6 Accounts receivable 7 Office Supplies 8 Inventory 9 Pre-paid rent 10 Notes Rec 11 Fixed assets 12 Building $252,845.00 13 Furniture $5,000.00 14 Equipment $56,000.00 15 Land $42,000.00 16 (Less Accumulated Depreciation) $157,000.00 17 Total assets 18 Current liabilities 19 Salaries Payable 20 Accounts payable 21 Long term liabilities 22 Notes Payable 23 Total Liabilities 24 Capital Stock 25 Retained Earnings 26 Total Liabilities and Shareholder Equity 27 28 $198,845.00 $802,554.00 $3,000.00 $88,437.00 $456,286.00 $547,723.00 $100,000.00 $154,831.00 $802,554.00 1 ABC Inc 2 UNADJUSTED UNTRIAL BALANCE 3 12/31/20 4 Cash 5 Accounts receivable 6 Office Supplies 7 Inventory 8 Pre-paid rent 9 Building 10 Furniture 11 Equipment 12 Notes Rec 13 Land 14 Accumulated Depreciation 15 Salaries Payable 16 Accounts payable 17 Notes Payable 18 Capital Stock 19 Retained Earnings 20 Sales Revenue 21 COGS 22 Salaries Expense 23 Dividends 24 Rent Expense 25 26 DR CR $6,255.00 $1,258.00 $11,487.00 $441,742.00 $4,000.00 $252,845.00 $9,000.00 $62,000.00 $81,612.00 $42,000.00 $157,000.00 $5,000.00 $83,125.00 $440,035.00 $100,000.00 $154,831.00 $163,208.00 $81,000.00 $42,000.00 $50,000.00 $18,000.00 $1,103,199.00 $1,103,199.00