CHAPTER 3 Adjusting Accounts for Financial Statements of its first two months, Mary Graham has decided to continue operating Echo Sus- occurred in these months are described in Chapter 2) Before proceeding in The transactions that er, Graham adds these new accounts to the chart of accounts for the ledger the c Accumulated Deprecuation, Office Equipment Accumulated Depreciation, Computer Equipment wages Payable Uneamed Computer Services Revenue Depreciation Expense, Office Equipment Depreciation Expense, Computer Equipment. Insurance Expense 168 210 236 612 613 637 640 652 Computer Supplies Expense. are journal entries to record each of the following transactions for Echo Systems. Post the entries to the accounts in the ledger 3 Paid $2.100 to the Lakeshore Mai for the company's share of mal advertising costs. 3 Paid $1.200 to repair the company's computer 4 Received $7.500 from Alamo Engineering Co. for the receivoble from the prior month. 10 Paid Carly Smith for sik days' work at the rate of $200 per day Notified by Alamo Engineering Co. that Echo's bid of $12.000 on a proposed project was accepted. Alamo paid an advance of $3,000 17 Purchased $2.310 of computer supplies on credit from Abbott office Sent a reminder to Fostek Co. to pay the fee for services oniginally recorded on November 8 18 20 Completed a project for Eite Corporation and received $11,250 cash. 24-28 Took the week off for the holidays 31 Received $5,700 from Fostek Co on its receivable 31 31 Reimbursed Mary Graham's business automobile expenses of 600 kilometres at $1.00 per kilometre. Graham withdrew $3,600 cash from the business. 2 Prepare adjustin g entries to record the following additional information collected on December 31, 2017. Post the entries to the accounts in the ledger a. The December 31 inventory of computer supplies was $1,440. b. Three months have passed since the annual insurance premium was paid e. As of the end of the year, Carly Smith has not been paid for four days of work at the rate of $200 per day d. The computer is expected to have a four-year life with no residual value. e. The office equipment is expected to have a three-year life with no residual value. f. Prepaid rent for three of the four months has expired. 3. Prepare an adjusted trial balance as of December 31, 2017. 4. Prepare an income statement and statement of changes in equity for the three months ended December 31, 2017 5. Prepare a balance sheet as of December 31,2017. 229 CHAPTER 3 Adjusting Accounts for Financial Statements of its first two months, Mary Graham has decided to continue operating Echo Sus- occurred in these months are described in Chapter 2) Before proceeding in The transactions that er, Graham adds these new accounts to the chart of accounts for the ledger the c Accumulated Deprecuation, Office Equipment Accumulated Depreciation, Computer Equipment wages Payable Uneamed Computer Services Revenue Depreciation Expense, Office Equipment Depreciation Expense, Computer Equipment. Insurance Expense 168 210 236 612 613 637 640 652 Computer Supplies Expense. are journal entries to record each of the following transactions for Echo Systems. Post the entries to the accounts in the ledger 3 Paid $2.100 to the Lakeshore Mai for the company's share of mal advertising costs. 3 Paid $1.200 to repair the company's computer 4 Received $7.500 from Alamo Engineering Co. for the receivoble from the prior month. 10 Paid Carly Smith for sik days' work at the rate of $200 per day Notified by Alamo Engineering Co. that Echo's bid of $12.000 on a proposed project was accepted. Alamo paid an advance of $3,000 17 Purchased $2.310 of computer supplies on credit from Abbott office Sent a reminder to Fostek Co. to pay the fee for services oniginally recorded on November 8 18 20 Completed a project for Eite Corporation and received $11,250 cash. 24-28 Took the week off for the holidays 31 Received $5,700 from Fostek Co on its receivable 31 31 Reimbursed Mary Graham's business automobile expenses of 600 kilometres at $1.00 per kilometre. Graham withdrew $3,600 cash from the business. 2 Prepare adjustin g entries to record the following additional information collected on December 31, 2017. Post the entries to the accounts in the ledger a. The December 31 inventory of computer supplies was $1,440. b. Three months have passed since the annual insurance premium was paid e. As of the end of the year, Carly Smith has not been paid for four days of work at the rate of $200 per day d. The computer is expected to have a four-year life with no residual value. e. The office equipment is expected to have a three-year life with no residual value. f. Prepaid rent for three of the four months has expired. 3. Prepare an adjusted trial balance as of December 31, 2017. 4. Prepare an income statement and statement of changes in equity for the three months ended December 31, 2017 5. Prepare a balance sheet as of December 31,2017. 229
