Financial & Managerial Accounting (16th Edition) Can you provide a solution for chapter 11, Problem 1CP

Guitar Universe, Inc., is a popular source of musical instruments for professional and amateur musicians. The company's accountants make necessary adjusting entries monthly, and they make all closing entries annually. Guitar Universe is growing rapidly and prides itself on having no long-term liabilities The company has provided the following trial balance dated December 31, 2011 GUITAR UNIVERSE, INC TRIAL BALANCE DECEMBER 31, 2011 Cash 45,000 25,000 125,000 Accounts receivable Allowance for doubtful accounts. Merchandise inventory. Office supplies Prepaid insurance Building and fixtures $5,000 250,000 1,200 6,600 1,791,000 800,000 Accounts payable Unearned customer deposits Income taxes payable. Capital stock Retained earnings Unrealized holding gain on investments 70,000 8,000 75,000 1,000,000 240,200 6,000 1,600,000 958,000 200 9,000 395,000 400 6,400 3,600 48,000 Bank service charges Salary and wages expense . expense. Utilities expense Income tax expense $3,804,200 $3,804,.200 Other information pertaining to Guitar Universe's trial balance is shown below 1. The company's most recent bank statement reports a balance of S46,975. Included with the bank statement was a $2,500 check from Iggy Bates, a professional musician, charged back to Guitar Universe as NSF. The bank's monthly service charge was S25. Three checks written by Guitar Universe to suppliers of merchandise inventory had not yet cleared the bank for payment as of the statement date. These checks included: no. 507, S4,000; no. 511, S9,000; and no. 521, $8,000. Deposits made by Guitar Universe of $16,500 had reached the bank too late for inclusion in the current statement. The company prepares a bank reconciliation at the end of each month. 2. Guitar Universe has a portfolio of marketable securities. The initial investment in the portfolio was $19,000. As of December 31, the market value of these securities was S27,500. Management classifies all short-term investments as "available for sale 3. During December, S6,400 of accounts receivable were written off as uncollectible. A recent aging of the company's accounts receivable helped management to conclude that an allowance for doubtful accounts of $8,500 was needed at December 31, 2011