1 The unadjusted trial balance for Swift Creek Engineering at its year end, December 31, 2014, is as follows: SWIFT CREEK ENGINEERING Trial Balance December 31, 2014 Debit Credit Cash $8,000 Accounts receivable 6,450 Supplies 5,150 Prepaid insurance 7,560 Notes receivable 12,500 Equipment 26,700 Accumulated depreciationequipment $8,010 Accounts payable 5,000 H. Duguay, capital 43,350 H. Duguay, drawings 55,500 Service revenue 105,000 Salaries expense 39,500 $161,360 $161,360 Additional information: 1. Revenue of $1,550 was earned but unrecorded as at December 31, 2014. 2. On June 1, the company purchased a one-year insurance policy. 3. Depreciation on the equipment for 2014 is $2,670. 4. A count on December 31, 2014, showed $710 of supplies on hand. 5. The four-month, 4% note receivable was issued on October 1, 2014. Interest and principal are payable on the maturity date. Question 2 The following is Elbow Cycle Repair Shop's trial balance at January 31, 2014, the companys fiscal year end: ELBOW CYCLE REPAIR SHOP Trial Balance January 31, 2014 Debit Credit Cash $3,600 Accounts receivable 6,670 Prepaid insurance 6,420 Supplies 5,240 Land 55,000 Building 90,000 Accumulated depreciationbuilding $11,000 Equipment 27,000 Accumulated depreciationequipment 4,500 Accounts payable 7,100 Unearned revenue 1,990 Mortgage payable 102,400 H. Dude, capital 61,000 H. Dude, drawings 96,100 Service revenue 236,550 Salaries expense 116,200 Utilities expense 12,000 Interest expense 6,310 $424,540 $424,540 Additional information: 1. Service revenue earned but not recorded at January 31, 2014, was $1,550. 2. The 12-month insurance policy was purchased on March 1, 2013. 3. A physical count of supplies shows $580 on hand on January 31, 2014. 4. The building has an estimated useful life of 45 years. The equipment has an estimated useful life of 15 years. 5. Salaries of $1,520 are accrued and unpaid at January 31, 2014. 6. The mortgage payable has a 6% interest rate. Interest is paid on the first day of each month for the previous month's interest. 7. By January 31, 2014, $850 of the unearned revenue has been earned. 8. During the next fiscal year, $4,500 of the mortgage payable is to be paid. Collapse question part (a) Prepare the adjusting entries. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Round answers to 0 decimal places, e.g. 5,275.) Date Account Titles and Explanation Debit Credit Jan. 31 Accounts Receivable Service Revenue No Entry Interest Expense Unearned Revenue Unearned Revenue Interest Expense No Entry Accounts Receivable Service Revenue (To accrue revenue earned but not billed or collected) Jan. 31 Insurance Expense Prepaid Insurance Interest Payable Salaries Expense No Entry Prepaid Insurance No Entry Insurance Expense Interest Payable Salaries Expense (To record insurance expired) Jan. 31 No Entry Salaries Expense Supplies Expense Supplies Unearned Revenue Supplies Expense No Entry Supplies Salaries Expense Unearned Revenue (To record supplies used) Jan. 31 Supplies Expense No Entry Accumulated Depreciation - Building Depreciation Expense Accumulated Depreciation - Equipment Accumulated Depreciation - Building Accumulated Depreciation - Equipment Depreciation Expense No Entry Supplies Expense Accumulated Depreciation - Building Accumulated Depreciation - Equipment Supplies Expense No Entry Depreciation Expense (To record depreciation) Jan. 31 Salaries Expense No Entry Prepaid Insurance Salaries Payable Interest Expense No Entry Interest Expense Salaries Expense Salaries Payable Prepaid Insurance (To record accrued salaries) Jan. 31 Interest Expense Interest Payable No Entry Insurance Expense No Entry Interest Expense Interest Payable Insurance Expense (To record accrued interest) Jan. 31 No Entry Unearned Revenue Interest Expense Service Revenue Accounts Receivable No Entry Service Revenue Accounts Receivable Interest Expense Unearned Revenue (To record revenue for services provided)