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ABC Corp. provided the following balances on March 31, 2024: Cash: $25,000 Accounts Receivable: $15,000 Supplies: $3,000 Accounts Payable: $9,000 Interest Payable: $2,000 Buildings: $50,000

ABC Corp. provided the following balances on March 31, 2024:

  • Cash: $25,000
  • Accounts Receivable: $15,000
  • Supplies: $3,000
  • Accounts Payable: $9,000
  • Interest Payable: $2,000
  • Buildings: $50,000
  • Accumulated Depreciation: $8,000
  • Mortgage Payable: $30,000
  • Common Stock: $25,000
  • Retained Earnings: $19,000

Requirements:

  1. Prepare a trial balance.
  2. Journalize adjusting entries for:
    • Depreciation expense: $3,000
    • Supplies used: $1,000
  3. Prepare an adjusted trial balance.
  4. Draft a statement of retained earnings.
  5. Describe the role of depreciation in financial reporting.

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