CP10 & CP11 are the questions and Possible Account Titles are thepossible account names. Thank you!

The work may be done in Excel, Word, MS Works (word processor or spreadsheet), Open Office, or Rich Text. First Problem: Your ONLY have to do Instructions (1.) and (2.) [See Below for Alternate Instruction (3)]. For Adjustment Data #3 the Hint suggests that you prepare an Income Statement through Income Before Income Tax (this figure should come out to be $104,150) in order to calculate the amount of Income Tax Expense--you need to do this but it can be an informal (just revenues minus expenses) one that you DO NOT submit as part of your graded work. If you can come to this check figure before you move on, your chances of being correct are much better. Also, I would strongly suggest that you use T-accounts and post Beginning Balances and ALL journal entries and again these do NOT have to be turned in with your work, but you may have them in your file (they will not be graded). As a self-check, your Adjusted Trial Balance should first of all have equal Debit and Credit totals and second come out to be $687,695. In place of Instruction (3.), you need to prepare all necessary Closing Entries. CP10 Trevor Corporation's balance sheet at December 31, 2013, is presented below. TREVOR CORPORATION Balance Sheet December 31, 2013 Cash $30,000 Accounts payable $13,750 Inventory 30,750 Interest payable 2,500 Prepaid insurance 5,600 Bonds payable 50,000 Equipment 38,000 Common stock 25,000 $104,350 Retained earnings 13,100 $104,350 During 2014, the following transactions occurred: 1. Trevor paid $2,500 interest on the bonds on January 1, 2014. 2. Trevor purchased $241,100 of inventory on account. 3. Trevor sold for $480,000 cash inventory which cost $265,000. Trevor also collected $28,800 sales taxes. 4. Trevor paid $230,000 on accounts payable. 5. Trevor paid $2,500 interest on the bonds on July 1, 2014. 6. The prepaid insurance ($5,600) expired on July 31. 7. On August 1, Trevor paid $10,200 for insurance coverage from August 1, 2014, through July 31, 2015. 8. Trevor paid $17,000 sales taxes to the state. 9. Paid other operating expenses, $91,000. 10. Redeemed the bonds on December 31, 2014, by paying $48,000 plus $2,500 interest. 11. Issued $90,000 of 8% bonds on December 31, 2014, at 103. The bonds pay interest every June 30 and December 31. Adjustment data: 1. Recorded the insurance expired from item 7. 2. The equipment was acquired on December 31, 2013, and will be depreciated on a straight-line basis over 5 years with a $3,000 salvage value. 3. The income tax rate is 30%. (Hint: Prepare the income statement up to income before taxes and multiply by 30% to compute the amount.) Instructions (You may want to set up T-accounts to determine ending balances.) 1. Prepare journal entries for the transactions listed above and adjusting entries. 2. Prepare an adjusted trial balance at December 31, 2014. Totals $687,695 3. Prepare an income statement and a retained earnings statement for the year ending December 31, 2014, and a classified balance sheet as of December 31, 2014. N.I. $72,905 Second Problem: Again, you ONLY have to do Instructions (1.) and (2.) [See below for same Alternate Instruction (3)] and the same Hint applies for calculating Income Tax Expense (Income Before Tax should be $117,100). One Big Caution on this problem--the Opening Document is a Balance Sheet (Net Assets = Liabilities + Stockholders' Equity) NOT, a Trial Balance (Debit Balances = Credit Balances)!!! Watch the Contra Accounts. My suggestion for T-accounts applies to this problem also. Just another suggestion, but a quick review of my Introduction to this Chapter might help :-) The check figure for this Adjusted Trial Balance is $740,690. All Necessary Closing Entries are again REQUIRED in place of Instruction (3.). CP11 Klinger Corporation's balance sheet at December 31, 2013, is presented below. KLINGER CORPORATION Balance Sheet December 31, 2013 Cash $24,600 Accounts payable $25,600 Accounts receivable 45,500 Common stock ($10 par) 80,000 Allowance for doubtful accounts (1,500) Retained earnings Supplies 4,400 Land 40,000 Buildings 142,000 Accumulated depreciationbuildings (22,000) 127,400 $233,000 $233,000 During 2014, the following transactions occurred. 1. On January 1, 2014, Klinger issued 1,200 shares of $40 par, 7% preferred stock for $49,200 2. On January 1, 2014, Klinger also issued 900 shares of the $10 par value common stock for $21,000. 3. Klinger performed services for $320,000 on account. 4. On April 1, 2014, Klinger collected fees of $36,000 in advance for services to be performed from April 1, 2014, to March 31, 2015. 5. Klinger collected $276,000 from customers on account. 6. Klinger bought $35,100 of supplies on account. 7. Klinger paid $32,200 on accounts payable. 8. Klinger reacquired 400 shares of its common stock on June 1, 2014, for $28 per share. 9. Paid other operating expenses of $188,200. 10. On December 31, 2014, Klinger declared the annual preferred stock dividend and a $1.20 per share dividend on the outstanding common stock, all payable on January 15, 2015. 11. An account receivable of $1,700 which originated in 2013 is written off as uncollectible. Adjustment data: 1. A count of supplies indicates that $5,900 of supplies remain unused at year-end. 2. Recorded revenue from item 4 above. 3. The allowance for doubtful accounts should have a balance of $3,500 at year end. 4. Depreciation is recorded on the building on a straight-line basis based on a 30-year life and a salvage value of $10,000. 5. The income tax rate is 30%. (Hint: Prepare the income statement up to income before taxes and multiply by 30% to compute the amount.) Instructions (You may want to set up T-accounts to determine ending balances.) 1. Prepare journal entries for the transactions listed above and adjusting entries. 2. Prepare an adjusted trial balance at December 31, 2014. Totals $740,690 3. Prepare an income statement and a retained earnings statement for the year ending December 31, 2014, and a classified balance sheet as of December 31, 2014. Net income $81,970 Tot. assets $421,000 Possible Account Titles Finals Work Problems: Allowance for Doubtful Accounts Accumulated Depreciation Bad Debt Expense Cash Dividends Cost of Goods Sold Depreciation Expense Discount on Bonds Payable Dividends Payable Earned Service Revenue Gain on Bond Redemption Income Tax Expense Income Tax Payable Insurance Expense Insurance Payable Interest Expense Interest Payable Loss on Bond Redemption Operating Expenses Paid-in Capital in Excess of Par-CS Paid-in Capital in Excess of Par-PS Preferred Stock Premium on Bonds Payable Sales Tax Payable Sales Revenue Service Revenue Supplies Expense Supplies Payable Treasury Stock Unearned Service Revenue