Bug-Off Exterminators provides pest control services and sells extermination products manufactured by other companies. The following six-column table contains the company's unadjusted trial balance as of December 31, 2018. BUG-OFF EXTERMINATORS December 31, 2018 Unadjusted Trial Balance Cash $ 18,200 Accounts receivable Allowance for doubtful accounts Merchandise inventory 3,800 $ 822 12,100 Trucks Accum. depreciation-Trucks Equipment 30,700 0 52,000 Accum. depreciation-Equipment 11,200 Accounts payable Estimated warranty liability 4,000 1,300 Unearned services revenue 0 Interest payable 0 Long-term notes payable 14,600 Common stock 11,000 Retained earnings 49,200 Dividends 12,000 Extermination services revenue 56,000 Interest revenue. 870 Sales (of merchandise) 79,415 Cost of goods sold 44,200 Depreciation expense-Trucks 0 Depreciation expense-Equipment Wages expense Interest expense Rent expense Bad debts expense Miscellaneous expense Repairs expense Utilities expense 0 33,000 0 7,800 0 1,207 6,500 6,900 Warranty expense Totals 0 $228,407 $228,407 e. On August 1, 2018, the company is paid $3,840 cash in advance to provide monthly service for an apartment complex for one year. The company began providing the services in August. When the cash was received, the full amount was credited to the Extermination Services Revenue account. f. The company offers a warranty for the services it sells. The expected cost of providing warranty service, is 2.5% of the extermination services revenue of $53,760 for 2018. No warranty expense has been recorded for 2018. All costs of servicing warranties in 2018 were properly debited to the Estimated Warranty Liability account. g. The $15,000 long-term note is an 8%, five-year, interest-bearing note with interest payable annually on December 31. The note was signed with First National Bank on December 31, 2018. h. The ending inventory of merchandise is counted and determined to have a cost of $11,700. Bug-Off uses a perpetual inventory system. Required: 1. Use the preceding information to determe amounts for the following items. a. Correct (reconciled) ending balance of Cash, and the amount of the omitted check. b. Adjustment needed to obtain the correct ending balance of the Allowance for Doubtful Accounts. c. Depreciation expense for the truck used during year 2018. d. Depreciation expense for the two items of equipment used during year 2018. e. The adjusted 2018 ending balances of the Extermination Services Revenue and Unearned Services Revenue accounts. f. The adjusted 2018 ending balances of the Warranty Expense and the Estimated Warranty Liability accounts. g. The adjusted 2018 ending balances of the Interest Expense and the Interest Payable accounts. 2. Use the results of part 1 to complete the six-column table by first entering the appropriate adjustments for items a through g and then completing the Adjusted Trial Balance columns. (Hint: Item b requires two adjustments.) 3. Prepare journal entries to record the adjustments entered 4n the six-column table. Assume Bug-Off's adjusted balance for Merchandise Inventory matches the year-end physical count. 4-a. Prepare a single-step income statement for year 2018. 4-b. Prepare a statement of retained earnings (cash dividends during 2018 were $10,000) for year 2018. 4-c. Prepare a classified balance sheet as at 2018. Use the results of part 1 to complete the six-column table by first entering the appropriate adjustments for items a through g and then completing the Adjusted Trial Balance columns. (Hint: Item b requires two adjustments.) BUG-OFF EXTERMINATORS December 31, 2018 Unadjusted Trial Balance Adjustments Adjusted Trial Balance Account Title Debit Credit Debit Credit Debit Credit Cash $ 18,200 Accounts receivable 3,800 Allowance for doubtful accounts $ 822 Merchandise inventory 12,100 Trucks 30,700 Accum. deprec.-Trucks 0 Equipment 52,000 Accum. deprec.-Equip 11,200 Accounts payable Estim. warranty liability 4,000 1,300 Unearned services rev Interest payable Long-term notes payable Common stock Retained earnings Dividends 0 0 14,600 11,000 49,200 12,000 Extermination services revenue 56,000 Interest revenue 870 Sales 79,415 Cost of goods sold 44,200 Deprec. expense-Trucks 0 Deprec. expense-Trucks Deprec. expense-Equip Wages expense Interest expense 0 0 33,000 0 Rent expense 7,800 Bad debts expense 0 Miscellaneous expense 1,207 Repairs expense 6,500 Utilities expense 6,900 Warranty expense 0 Totals $228,407 $228,407