ch3-14

Gonzalez Technical Institute (GTI), a school owned by Maria Gonzalez, provides training to individuals who pay tuition directly to the school. GTI also offers training to groups in off-site locations. Its unadjusted trial balance as of December 31, is found on the trial balance tab. GTI initially records prepaid expenses and unearned revenues in balance sheet accounts. Descriptions of items a through n that require adjusting entries on December 31, a. An analysis of GTI's Insurance policies shows that $2,600 of coverage has expired. b. An Inventory count shows that teaching supplies costing $2,960 are available at year-end. c. Annual depreciation on the equipment is $7,200. d. Annual depreciation on the professional library is $10,600 e. On September 1, GTI agreed to do five courses for a client for $3,200 each. Two courses will start immediately and finish before the end of the year. Three courses will not begin until next year. The client paid $16,000 cash in advance for all five courses on September 1, and GTI credited Unearned Training Fees. f. On October 15, GTI agreed to teach a four-month class (beginning immediately) for an executive with payment due at the end of the class. At December 31, $9,500 of the tuition has been earned by GTI. 9. Ghis two employees are paid weekly. As of the end of the year, two days' salaries have accrued at the rate of $180 per day for each employee. h. The balance in the Prepaid Rent account represents rent for December. Requirement General Journal General Ledger Trial Balance Income Statement St Owner Equity Balance Sheet Impact on income For each adjustment, indicate the income statement and balance sheet apcount affected, and the impact on net Income. If an adjustment caused net income to decrease, enter the amount as a negative value. Net income before adjustments can be found on the income statement tab. (Hint Select unadjusted on the drop-down.) Gonzalez Technical Institute Income Statement For Year Ended December 31 Revenues Training fees earned Tuition fees earned $ 48,400 137,500 0 $ 185,900 at nt ences Total revenues Expenses Depreciation expense - Professional library Depreciation expense - Equipment Salaries expense Insurance expense Rent expense Teaching supplies expense Advertising expense Utilities expense 10,600 7,200 51,520 2,600 41,800 0 6.100 6,600 0 0 Total expenses Net income 126,420 59,480 $