112 Q-1) Harvey Specter started his own firm, Specter Co. on July 1, 2011. The list of different account titles with respective balances (each account has a normal balance) at September 30, 2013 is as follows - Specter Co. List of Accounts September 30, 2013 Account # Account Title Balance ($) 101 Cash 8,100 Accounts Receivable 10,800 126 Prepaid Insurance 8,400 130 Building 50,000 149 Equipment 24,000 201 Accounts Payable 20,000 209 Unearned Service Revenue 6,000 254 Capital 22,900 330 Drawing 10,000 354 Sales Revenue 60,000 333 Salaries Expenses 7,000 440 Rent Expenses 30,000 470 Advertising Expenses 3,500 380 Inventories 1,500 480 Trade mark 21,000 420 Mortgage payable 48,000 355 Dividend Revenue 19000 202 Accumulated Depreciation - 4,000 building 205 Supplies 5,600 Instruction: Instruction: (a) Prepare a single step income statement and owner's equity statement for quarter ending September 30 and a classified balance sheet as of September 30, 2013. (5+5+14=24 marks) 6) Harvey just realized his accountant forgot to take account of the adjusting entries before preparing the financial statements. So, journalize the following adjusting entries on September 30 for the 3-month period July 01 - September 30. (16 marks) 1. At the end of September unearned revenue remains unearned is $4,500. 2. Employees are paid weekly and at the end of the week. September 30 is Wednesday and employees are paid on Thursdays. Company has three employees, who are paid $3,750 each for a 5-day work week (Sunday - Thursday). 3. Insurance policy is for 2-years (policy covers from August 01, 2013 to July 31, 2015). 4. The equipment has a 5-year life (purchased on July 1, 2013). It is being depreciated at $400 per month for 60 months. 5. Mortgage interest rate is 12%. (Mortgage taken out on July 01, 2013 for 2 years). 6. Utilities expense incurred but not paid on September 30, 2013, $250. 7. $600 of supplies has been used. 8. Invoices representing $1,150 of services performed during the month have not been recorded as of September 30. Q-2) The list of accounts of Guardian Company contained the following information: Accounts Amount $ Sales 750,000 Sales Returns and Allowances 20,000 Rent Expense 5,000 Purchases 600,000 Sales Discounts 7,000 Purchase Returns and Allowances 25,000 Cost of Goods Sold ? Interest Revenue 15,000 Sales commission 15,000 Purchase Discounts 11,000 Interest Expense 10,000 Freight-out 2,000 Store Salaries Expense 50,000 Freight-in 19,000 Utilities Expense 28,000 Auditor fees 1,000 Depreciation Expense 5,000 Payroll tax expense 2,000 Dividend revenue 5,000 Beginning inventory 45,000 Rent Revenue 10,000 Ending inventory 55,000 Lawsuit defrayal expense 7,000 Accumulated depreciation 15000 Instruction. Instruction: Use the above information to prepare a multiple-step income statement for the year ended December 31, 2019. (Show the calculation of COGS) (20 marks) Section-B (Short Q/A) Answer the following independent questions including computations (if needed) or examples supporting your answers. (3 questions *5 marks=15 marks) I. Zulu's Market recorded the following events involving recent transactions of merchandise: June 1: Received goods for $50,000, terms 2/10, n/30. June 2: Returned $1,000 of the shipment for credit. June 2: Paid $250 freight on the shipment. June 12: Paid the invoice. June 13: Payment of $100 freight on goods sold. As a result of these events, what would be the impact on the company's merchandise inventory? Demonstrate with calculation. @ + II. A candy factory's employees work overtime to finish an order that is sold on February 28