36. June 30:Income taxes are to be computed at the rate of 25 percent of net income before taxes. [IMPORTANT NOTE: Since the income taxes are a percent of the net income you will want to prepare the Income Statements through the Net Income Before Tax line. The worksheet contains all of the accounts and their balances which you can then transfer to the appropriate financial statement.] Closing Entries 37. Close the revenue accounts. 38. Close the expense accounts. 39. Close the income summary account. 40. Close the dividends account. June 30: The fixed assets have estimated useful lives as follows: 32. Building - 31.5 years Computer Equipment - 5.0 years Office Equipment - 7.0 years Use the straight-line method of depreciation. Management has decided that assets purchased during a month are treated as if purchased on the first day of the month. The building's scrap value is $8,000. Th office equipment has a scrap value of $350. The computer equipment has no scrap value. Calculate the depreciation for one month. 33. June 30: A review of the payroll records show that unpaid salaries in the amount of $1,533.00 are owed t the employees of Byte for three days, June 28 - 30. 34. June 30: J. Collins, the Internal Auditor, indicated that $1,720.00 of the revenue recorded in June will n be earned until August. 35. June 30: The note payable in transaction #6 and transaction #8 is a five-year note, with interest at the rate of 12 percent annually. Interest expense should be computed based on a 360 day year. [IMPORTANT NOTE: The original note on the computer equipment purchased on June 2 was $132,00 On June 10, eight days later, $25,250 was repaid. Interest expense must be calculated on the $132,000 for eight days. In addition, interest expense on the $106,750 balance of the loa ($132,000 less $25,250 = $106,750) must be calculated for the 20 days remaining in the month of June.] 25. June 30: Received a bill for the amount of $890.00 from O&G Oil and Gas Co. The invoice number was 784537. 26. June 30: Paid a cash dividend of $0.18 per share to the three shareholders of Byte, using Check # 6012 - 6014. [IMPORTANT NOTE: The number of shares of capital stock outstanding can be determined from the first three transactions.] Adjusting Entries - Round to two decimal places =ROUND(number,num_digits). 27. June 30: A review of Byte's job worksheets show that there are unbilled revenues in the amount of $5,500 for the period of June 28-30. 28. June 30: A physical inventory showed that only $247.00 worth of office supplies remained on hand as of June 30. 29. June 30: The rent payment made in transaction# 13 was for June and July. Expense the amount associated with one month's rent. 30. June 30: The annual interest rate on the mortgage payable was 8.00 percent. Interest expense for one-half month should be computed because the building and land were purchased and the liability incurred on June 16. 31. June 30: Information relating to the prepaid insurance may be obtained from transaction #4. Record a journal entry to reflect that one half month's insurance has expired. 16. June 22: Check # 6008 was used to pay salaries of $2,555.00 to equipment operators for the week ending June 18. Ignore payroll taxes. 17. June 22: Check # 6009 was used to purchase a scanning machine for the office from Sicre's Office Machines Express for $650.00. The invoice number was 975-328. 18. June 22: Cash in the amount of $3,365 was received on billings. 19. June 23: Purchased office supplies for $605.00 from Office Max on account. The invoice number was 65498. 20. June 23: Received a bill for $1,290.00 from Computer Parts and Repair Co. for repairs to the computer equipment. The invoice number was 43254. 21. June 28: Billed various miscellaneous local customers $5,595 for consulting services performed. 22. June 29: Check # 6010 was used to pay invoice number 43254, the computer repair bill that was previously received from Computer Parts and Repair Co. 23. June 29: Byte received $5,300.00 from customers billed when work was completed. 24. June 29: Check # 6011 was used to pay salaries of $2,555.00 to equipment operators for the week ending June 25. Ignore payroll taxes. 08. June 14: Check # 6003 was issued for $25,250 as a partial payment on the balance owed to Dell related to the purchase of computer equipment, invoice 827364. 09. June 16: A check in the amount of $6,250 was received for services performed for Pitman Pictures. 10. June 16: Byte purchased a building and the land it is on for $101,000.00 to house its repair facilities and to store computer equipment. The lot on which the building is located is valued at $16,000.00. The balance of the cost is to be allocated to the building. Check # 6004 was used to make the down payment of $10,100.00. A thirty year mortgage with an inital payement due on August 1st, was established for the balance. 11. June 17: Billed various miscellaneous local customers $4,200 for consulting services performed. 12. June 17: Byte received invoice number 26354 in the amount of $325.00 from Fida Marketing Agency for advertising. 13. June 21: Check # 6005 for $5,000.00 was paid for rent for June and July. Put the total amount into the Prepaid Rent account. 14. June 21: Accounts payable in the amount of $3,360.00 were paid with Check # 6006. 15. June 21: Check # 6007 was used to pay invoice number 26354, the advertising bill that was previously received from Fida Digital Marketing Agency. 01. June 1: Jason, an investor, made an investment in Byte by purchasing 3,200 shares of its common stock paying $92,800.00 in cash. 02. June 1: Lauryn, an investor, made an investment in Byte by purchasing 2,368 shares of its common stock paying $53,650.00 in cash, and contributing to Byte computer equipment with a fair market value of $13,920 and office equipment with a fair value of $1,102. 03. June 1: Leqi Ying, an investor, made an investment in Byte by purchasing 2,580 shares of its common stock paying $31,900.00 in cash, and contributing to Byte computer equipment with a fair market value of $42,920. 04. June 2: Check # 6001 was issued to purchase a one-year insurance policy covering its computer equipment. The cost of the insurance is $5,136.00 and paid to Seth's Insurance. The effective date of the policy was June 16 and the invoice number was 23 05. June 4: Additional office equipment costing $4,200 was purchased on credit from Perez's Discount Computer Corporation, invoice number AB9865. 06. June 8: Check # 6002 for $33,000 was issued as a down payment for new computer equipment that cost $165,000 on invoice 827364 from Dell. A five-year note was executed by Byte for the balance. 07. June 8: Defective office equipment costing $840 was returned to Perez's Discount Computer for credit to be applied against the outstanding balance owed by Byte. 105,910.00 236,292.00 105,910.00 236,292.00 2202 Notes Payable 3100 Capital Stock 3200 Retained Earnings 3300 Dividends 1,466.64 1,466.64 16,045.00 3,780.00 19,825.00 2,500.00 1,533.00 4100 Computer & Consulting Revenue 5010 Rent Expense 5020 Salary Expense 5030 Advertising Expense 5040 Repairs & Maint. Expense 5050 Oil & Gas Expense 5080 Supplies Expense 5090 Interest Expense 5100 Insurance Expense 5110 Depreciation Expense 5120 Income Tax Expense 5, 110.00 325.00 1,290.00 890.00 2,500.00 6,643.00 325.00 1,290.00 890.00 358.00 1,366.67 214.00 3,957.73 570.15 358.00 1,366.67 214.00 3,957.73 570.15 451,482.00 451,482.00 15,999.55 15,999.55 464,767.55 464,767.55 TOTAL NET INCOME Adjusting Entries Debit Credit Income Statement Debit Credit Balance Sheet Debit Credit Unadjusted Trial Balance Debit Credit 102,577.36 1,130.00 5,136.00 5,000.00 5,500.00 214.00 2,500.00 358.00 5,717.00 3,697.33 221,840.00 203.70 Account Number Name 1110 Cash 1120 Accounts Receivable 1130 Prepaid Insurance 1140 Prepaid Rent 1150 Office Supplies 1211 Office Equip. 1212 Accum. Depr.-Office Equip. 1311 Computer Equip. 1312 Accum. Depr.-Computer Equip. 1411 Building Cost 1412 Accum. Depr.-Building 1510 Land 2101 Accounts Payable 2102 Advanced Payments 2103 Interest Payable 2105 Salaries Payable 2106 Income Taxes Payable 2201 Mortgage Payable 2202 Notes Payable 3100 Capital Stock 3200 Retained Earnings 3300 Dividends Adjusted Trial Balance Debit Credit 102,577.36 6,630.00 4,922.00 2,500.00 358.00 5,717.00 3,697.33 221,840.00 203.70 85,000.00 56.70 16,000.00 2,335.00 1,720.00 1,366.67 1,533.00 570.15 90,900.00 105,910.00 236,292.00 85,000.00 56.70 16,000.00 2,335.00 1,720.00 1,366.67 1,533.00 570.15 90,900.00 105,910.00 236,292.00 1,466.64 1,466.64 16,045.00 3,780.00 19,825.00 2,500.00 1,533.00 4100 Computer & Consulting Revenue 5010 Rent Expense 5020 Salary Expense 5030 Advertising Expense 5040 Repairs & Maint. Expense 5050 Oil & Gas Expense 5, 110.00 325.00 1,290.00 890.00 2,500.00 6,643.00 325.00 1,290.00 890.00