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A group of four friends in Kingston formed a corporation called The Stanley Street Movie House Ltd (SSMHL). They felt that they could create a

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A group of four friends in Kingston formed a corporation called The Stanley Street Movie House Ltd (SSMHL). They felt that they could create a viable business showing classic movies and other films from the festival circuit that didn't get distribution to the large multiplex movie houses. They were also hoping to rent the space to local theatre companies for live productions. SSMHL purchased a small movie theatre near the downtown area. At the end of their first month of operation (September 2021), their accounts had the following balance before they made any adjusting or closing entries: Cash Accounts receivable Supplies Land Building Furniture Accounts payable Notes payable 33,150 750 3,700 35,000 90,000 5,000 6,200 112,500 Common shares Dividends declared Ticket revenue Concession revenue Rental revenue Utilities expense Wages expense 40,000 3,000 5,600 7,700 1,500 500 2,400 Knowing that you have some experience with accounting they have asked for your help in preparing statements so that they can see the results for September. In addition to the account balance, when you speak with the friends, you find out the following: The theatre purchase took place on September 1. The total purchase price for the theatre building and the land on which it is built was $125,000. The company paid $12,500 as a down payment and signed a Promissory note for the remainder of the purchase price. The note carries an interest rate of 6% per year. The building is not new. The friends expect that it will have a 10-year life after which it will have essentially zero value. They reckon on having to tear it down or make extensive renovations at that time. The furniture consists of theatre seats. These are expected to last five years at which time they will have no value. There are wages owing the employees of $250 that had not been recorded prior to your examination of the books. The dividends were declared and paid on September 28. An inventory taken on September 30 showed that $400 of supplies were on hand at that date. Required: 1. Using the Q-T Method post the Account Balances. 2. Post any adjusting entries to the accounts that you feel are necessary. Create additional T-accounts as necessary. 3. Prepare an income statement for the month ended September 30, 2021. 4. Prepare a balance sheet at September 30, 2021

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