Brothers Mike and Tim Hargen began operations of their tool and die shop (H & H Tool, Inc.) on January 1, 2011. The annual reporting period ends on December 31. The trial balance on January 1, 2012, follows:

Account titles Debit Credit

Cash	$ 4,000
Accounts receivable	7,000
Supplies	16,000
Land
Equipment	78,000
Accumulated depreciation (on equipment)		$ 8,000
Other assets (not detailed to simplify)	5,000
Accounts payable
Wages Payable
Interest payable
Income taxes payable
Long-term notes payable
Contributed capital (85,000 shares)		85,000
Retained earnings		17,000
Service revanue
Depreciation expense
Supplies expense
Wages expense
Interest expense
Income tax expense
Remaining expenses (not detailed to simplify)
Totals	$110,000	$110,000

Transactions during 2012 follow:

a. Borrowed $12,000 cash on a five-year, 10 percent note payable, dated March 1, 2012.

b. Purchased land for a future building site; paid cash, $12,000

c. Earned $208,000 in revenues for 2012, including $52,000 on credit and the rest in cash.

d. Sold 4,000 additional shares of capital stock for cash at $1 market value per share on January 1, 2012

e. Incurred $111,000 in Remaining expenses for 2012, including #20,000 on credit and the rest paid in cash.

f. Collected accounts receivable, $13,000 cash.

g. Purchasing other assets, $13,000 cash.

h. Paid accounts payable, $19,000.

i. Purchased supplies on account for future use, $23,000.

j. Signed a three-year $33,000 service contract to start February 1, 2013.

k. Declared and paid cash dividends, $22,000.

Data for adjusting entries:

l. Supplies counted on December 31, 2012. $18,000.

m. Depreciation for the year on the equipment, $8,000.

n. Interest accrued on notes payable (to be computed).

o. Wages earned by employees since the December 24 payroll but not yet paid $16,000.

p. Income tax expense, $10,000, payable in 2013.