Cash Accounts Accounts Receivable Allowance for Bad Debts: Inventory Prepaid Advertising Supplies Accounts Payable Unearned Revenue Long-Term Note Payable Common Stock Retained Earnings Sales Revenue Cost of Goods Sold Wages Expense Utility Expense Advertising Expense Totals Adjusting & Other Entries: Sinfully Sweet Desserts Unadjusted Trial Balance December 31, 2025 Debit Credit 105,800 14,600 1,900 10,000 1,200 4,200 14,200 12,000 7,000 72,900 28,800 74,200 40,200 10,700 3,400 20,900 211,000 211,000 December 31: In reviewing the bank statement, we find that during December, $2,100 in revenue was incorrectly debited to inventory instead of cash (the credit was correct). December 31: Determine that we earned (but haven't received) $11,300 in interest revenue on our savings account during the year. December 31: We earned $10,900 in sweets sales revenue during December 2025 that was paid for in advance by our customers. The cost of those sweets was $4,900. Prepare entries to record both the sale and cost of goods sold. Record both entries. December 31: Entire year's advertising ($1,200 per month) was paid in advance on January 1, 2025 (recorded in January)-one month of Prepaid Advertising remains to be recorded as Advertising Expense. December 31: Determined that $1,700 of supplies remain at the end of the period. December 31: December utilities are $2,799. The bill will be paid in January 2026. Utilities Expense and a Utilities Payable should be recorded. December 31: The company has not recorded bad debt expense for 2025. Sinfully uses the Aging of Receivables approach and estimates that the ending balance in the Allowance for Bad Debts should be $9,300 (Hint: You need to "back in" to this number - Ch. 8). December 31: The long term note payable was recorded on A just 1, 2025. The interest and the note are due on July 31, 2030. Interest rate is 9.5%. Record 2025 interest expense. December 31: Calculate Net Income Before Taxes and then record income taxes as 35% of this number (use the Multiple-Step Income Statement)-use this tax # to record the final adjusting entry for Income Tax Expense & Income Tax Payable AND as the Income Tax Expense figure in your Multiple-Step Income Statement. Note The taxes will be paid in March 2026. December 31: The bookkeeper forgot to enter a journal entry into the system. Therefore, you must also record an entry for a $11,500 dividend payment that the company made to its shareholders. (Debit Dividends & Credit Cash). This entry will not affect the tax entry above, as Dividends are not recorded on the Income Statement (but instead reduce RE on the Statement of RE). 3 Cash Ody Allowance for Bad Debts Ced Det Debut Inventory Supplies Accounts Receivable Interest Receivable D Prepaid Advertising Credit Oxbit Credit Accounts Payable Utilities Payable Income Tax Payable Unearned Revenue De Cred Gelt Interest Payable Cred Long-Term Note Payable Common Stock Cred Creat Retained Earnings Dividends Debat Celt Sales Revenue Interest Revenue Cost of Goods Sold Wages Expense Utilities Expense Advertising Expense Supplies Expense Bad Debt Expense Interest Expense Income Tax Expense Adjusting Entries Cash Accounts Accounts Receivable Allowance for Bad Debts Interest Receivable Adjusted Trial Balance Sinfully Sweet Desserts Adjusted Trial Balance Inventory Prepaid Advertising Supplies Accounts Payable Utilities Payable Income Tax Payable Unearned Revenue Interest Payable Long-Term Note Payable Common Stock Retained Earnings Dividends Sales Revenue Interest Revenue Cost of Goods Sold Wages Expense Utilities Expense Advertising Expense Supplies Expense Bad Debt Expense Interest Expense Income Tax Expense Totals December 31, 2025 Debit Credit Multiple-Step Income Statement Sales Revenue Sinfully Sweet Desserts Income Statement For the Year Ended December 31, 2025 Less: Cost of Goods Sold Gross Profit Operating Expenses: Wages Expense Utility Expense Advertising Expense Supplies Expense Bad Debt Expense Total Operating Expenses Total Operating Income Other Revenues and Expenses Interest Revenue Interest Expense Total Other Rev. (Exp.) Net Income Before Taxes Income Tax Expense Net Income Statement of Retained Earnings Sinfully Sweet Desserts Statement of Retained Earnings For the Year Ended December 31, 2025 Retained Earnings, Jan. 1, 2025 Add: Net Income Less: Dividends Retained Earnings, Dec. 31, 2025 ASSETS Current Assets Cash Accounts Receivable Less: Allowance for Bad Debts Net Accounts Receivable Interest Receivable Inventory Prepaid Advertising Supplies Total Current Assets Balance Sheet Sinfully Sweet Desserts Balance Sheet As of December 31, 2025 LIABILITIES Current Liabilities Accounts Payable Utilties Payable Income Tax Payable Unearned Revenue Total Current Liabilities Non-Current Liabilities Interest Payable Notes Payable Total Non-Current Liab. Total Liabilities STOCKHOLDERS' EQUITY Common Stock Retained Eamings Total Owners' Equity Total Liab. & SE 12