All Seasons Service 1 2 Trial Balance December 31, 2018 3 5 DR CR 6 Cash 126 7 Accounts Receivable 1,708 8 Office Supplies 9 Equipment 10 Accumulated Depreciation-Equipment 11 Accounts Payable 12 Credit Cards Payable 13 Short Term Notes Payable 14 Owner's Equity 15 Service Revenue 16 Advertising 17 Bank Service Charge 18 Client Expenses 19 Refreshments 20 Commissions Paid to Independent Contractors 21 Tax Expense 22 Dues and Subscriptions 23 Filing Fees 213 23,190 2,709 849 3,454 5,250 500 39,373 22 282 598 24 18,583 500 1,447 420 24 Gifts 25 25 Insurance 26 Interest Expense 852 982 27 Meals and Entertainment 286 28 Miscellaneous Expense 29 Listing Fees 30 Shipping 31 Supplies Expense 32 Office Supplies Expense 189 168 40 67 164 33 Electronic Lock Subscription 206 34 Telephone Expense 35 Website Expense 1,893 150 36 37 TOTALS 52,135 $ 52,135 38 There is an accompanying spreadsheet that is not perfectly formatted but it represents the data that was provided by a client for financial statement preparation in the form of an unadjusted trial balance. The following information is pertinent: 1. All insurance was paid in January for 1-year policies that are now expired The credit manager estimates that $350 of Accounts Receivable will be uncollectible Depreciation for 2018 has not yet been adjusted. The current year depreciation is calculated to be $474 2. 3. The commissions are paid to independent contractors, not employees No investments or withdraws were made by owners during the year Some of the supplies and office supplies were specific to a certain project, were used 4. 5. 6. immediately, and were originally charged to expense accounts A physical count of ordinary office supplies indicated that $103 worth of office supplies were still 7. present 8. Client Expense includes items such as permits, inspections, etc. that were paid by the business for specific clients 9 The client has elected to omit substantially all notes and disclosures that would normally accompany a financial statement Directions: Prepare journal entries to post the adjustments Prepare a Balance Sheet as of December 31, 2018 and related statements of Income and Equity 1. 2. for the year then ended (a worksheet may be helpful). Draft a cover letter forwarding these statements to your client (All Seasons Service) and guiding them in making adjustments and closing entries The statements as well as the cover letter must be in a professional typed format. 3. 4. Extra Credit The American Institute of Certified Public Accountants has issued Statements on Standards for Accounting and Review Services. For extra credit, assume this is aa compilation engagement under the most recent statements (SSARS 21). Compile these financial statements in such a way to conform with said standards Grading This assignment is weighted as two quizzes. Accordingly, extra credit could be very beneficial. Not typing the statements and/or other correspondence or missing/combining any of the statements will result in a grade of zero. This assignment is not eligible to be dropped like an ordinary quiz. You may work together but each student must submit his or her own project