Exercise 1. adjusting entries closing entries financial statements preparation Attrex Ltd. has the below unadjusted and adjusted Trial Balance for December 2021. Unadjusted Adjusted Debit Credit Debit Credit Cash $35,200 $35,200 Accounts receivable Unexpired insurance Prepaid rent $29,120 $1,200 $5,400 $34,120 $600 $3,600 Office supplies Equipment Accumulated depreciation: equipment Accounts payable Notes payable $680 $380 $60,000 $60,000 $49,000 $50,000 $5,100 $5,100 $5,000 $5,000 Interest payable $200 $250 Salaries payable $2,100 Income taxes payable $1,570 $2,170 Unearned revenue $6,800 $3,800 Capital stock $25,000 $25,000 Retained earnings $30,000 $30,000 Dividends $4,200 $4,200 Fees earned $91,530 $99,530 Advertising expense $1,500 $1,500 Insurance expense $6,600 $7,200 Rent expense $19,800 $21,600 Office supplies expense $1,200 $1,500 Repairs expense $4,800 $4,800 Depreciation expense: equipment $11,000 $12,000 Salaries expense $26,300 $28,400 Interest expense $200 $250 Income taxes expense $7,000 $214,200 $214,200 $7,600 $222,950 $222,950 a) Journalize the nine adjusting entries that the company made on December 31, 2021. b) Categorize all the nine JE made into the correct type of adjusting entry, based on the table below: Type I: converting assets to expenses Type II: converting liabilities to revenue Type III: accruing unpaid expenses Type IV: accruing uncollected revenue c) Refer to the adjusted trial balance of Attrex Ltd., illustrated above to respond to the following items: 1. Prepare all necessary closing entries on December 31, 2011. I. revenues to income summary II. expenses to income summary III. income summary to retained earnings account IV. dividends to retained earnings 2. Prepare an after-closing trial balance dated December 31, 2011. 3. 4. Prepare balance sheet, income statement & statement of retained earnings. Compare the Retained Earnings balance reported in the after-closing trial balance prepared in part ii) to the balance reported in the adjusted trial balance. Explain why the two balances are different. (Include in your explanation why the balance reported in the after-closing trial balance has increased or decreased subsequent to the closing process.)