Question
Drs. Glenn Feltham and David Ambrose began operations of their physical therapy clinic, called Northland Physical Therapy, on January 1, 2020. The annual reporting period
Drs. Glenn Feltham and David Ambrose began operations of their physical therapy clinic, called Northland Physical Therapy, on January 1, 2020. The annual reporting period ends December 31. The trial balance on January 1, 2021, was as follows (the amounts are rounded to thousands of dollars to simplify):
Transactions during 2021 (summarized in thousands of dollars) follow:
- Borrowed $22 cash on July 1, 2021, signing a six-month note payable.
- Purchased equipment for $25 cash on July 2, 2021.
- Issued additional shares of common stock for $5 on July 3.
- Purchased software on July 4, $3 cash.
- Purchased supplies on July 5 on account for future use, $7.
- Recorded revenues on December 6 of $55, including $8 on credit and $47 received in cash.
- Recognized salaries and wages expense on December 7 of $30; paid in cash.
- Collected accounts receivable on December 8, $9.
- Paid accounts payable on December 9, $10.
- Received a $3 cash deposit on December 10 from a hospital for a contract to start January 5, 2022.
Data for adjusting journal entries on December 31:
- Amortization for 2021, $1.
- Supplies of $3 were counted on December 31, 2021.
- Depreciation for 2021, $4.
- Accrued interest of $1 on notes payable.
- Salaries and wages incurred but not yet paid or recorded, $3.
- Income tax expense for 2021 was $4 and will be paid in 2022
1) Record journal entries for 1-10
2) Set up T-accounts for trial balance, entries 1-10, adjusting entries 11-16
3)Prepare Unadjusted trial balance using information from (2)
4)Record adjusting journal entries 11-16
5)Post the adjusting entries from from (4) and prepare adjusted trial balance
Prepare income statement, statement of retained earnings, and balance sheet from following information
Prepare closing journal entries, and post closing trial balance.
\begin{tabular}{|c|c|c|} \hline Account Titles & Debit & Credit \\ \hline Cash & $7 & \\ \hline Accounts Receivable & 3 & \\ \hline Supplies & 3 & \\ \hline Equipment & 8 & \\ \hline Accumulated Depreciation & & $1 \\ \hline Software & 5 & \\ \hline Accumulated Amortization & & 1 \\ \hline Accounts Payable & & 5 \\ \hline Notes Payable (short-term) & & \\ \hline Salaries and Wages Payable & & \\ \hline Interest Payable & & \\ \hline Income Taxes Payable & & \\ \hline Deferred Revenue & & \\ \hline Common Stock & & 15 \\ \hline Retained Earnings & & 4 \\ \hline Service Revenue & & \\ \hline Depreciation Expense & & \\ \hline Amortization Expense & & \\ \hline Salaries and Wages Expense & & \\ \hline Supplies Expense & a & \\ \hline Interest Expense & & \\ \hline Income Tax Expense & & \\ \hline Totals & $26 & $26 \\ \hline \end{tabular}
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