However, as the accountant of Loong Company, you notice the following additional informationmay require some more adjusting entries before preparing the financial statements:

$(1)$ On November $25,2023,$ a customer paid $$18,550$ to Loong Company in advance for an orderand the transaction was immediately recorded. Eventually half of the services were deliveredin December.$(2)$ Wages had been paid up to December $26,2023.$ Three staff of Loong had worked throughoutthe last $5$ days of December and they will be paid on January $1$ next year. Wage rate per staffis $$200$ per day.

$(3)$ On October $1,2023,$ the company lent $$25,000$ to one of its employees by signing a one yearnote at $6\%$ interest rate per annum. The principal plus interest will be payable by theemployee at the end of the loan period.

$(4)$ On December $31,2023$ a physical count was taken by the staff of Loong showing thatsupplies on hand at year end amounted to $$1,200.$

$(5)$ The estimated useful life of equipment is seven years and straight$-$line method is adopted. Itwas found that depreciation expense had been updated to September, $2023$ only.

$(6)$ On January $1,2023$ the Company paid and recorded in its books a two years$$ insurancepremium covering its facilities.

$(7)$ On November $15,2023,$ $$18,000$ rent was paid to the Company$$s landlord for December $2023$and January $2024.$ This transaction has been recorded in its books on the same day.

$(8)$ On December $31,$ the Company declared a cash dividend of $$0\mathrm{.}2$ per share to be paid in thefollowing year.

$(9)$ On December $31,2023.$ A $$3,000$ electricity bill belonged to one of the owner$$s home wasposted to Loong Company.

$(10)$ The income taxes expense for the year was estimated at $$25,000.$

Required:$($a$)$ Prepare the necessary adjusting journal entries on December $31,2023$ so as to bring thefinancial records of Loong up$-$to$-$date. Use the account titles given in the Trial Balance orcreate new accounts where appropriate. Workings are required, but explanations areNOT required. If no adjusting entries are required, state $$No entry$$ and name accountingprinciple applied. $(29$ marks$)$

$($b$)$ Prepare the income statement of Loong Company for the year ended December $31,2023,$showing breakdown of items under the captions of Total Revenues, Total Expenses, Profitbefore Tax, Profit after Tax. $(16$ marks$)$

$($c$)$ Prepare the statement of financial position as of December $31,2023,$ showing breakdown ofitems under the captions of Assets, Liabilities, and Shareholders$$ Equity $($Vertical format$).(25$ marks$)$

Question $1(70$ marks$)$

Loong Company is engaged in providing sports coaching services. The company nomally adjusts its book monthly and closes its books on $31$ December. Adjusting entries have already been made for the first $11$ months, except otherwise specified. Loong Company's financial year ends on December $31,2023$ and its umadjusted trial balance as of that date is as follows:

Loong Company

Unadjusted Trial Balance

As at December $31,2023$

$\backslash$table$[[$Account Title,Debit $$,$Credit S$],[$Cash$,68,650,],[$Accourts receivable,$118,075,],[$Prepaid rent,$18,000,],[$Prepaid insurance,$2,600,],[$Interest receivable,$250,],[$Supplies$,2,850,],[$Notes receivable,$25,000,],[$Equipment$,70,000,],[$Accumulated depreciation: Equipment,,$18,700],[$Income taxes payable,,$5,450],[$Unearned revenue,,$18,550],[$Accounts payable,,$23,650],[$Notes payable $($due on December $31,2025),,25,000],[$Share capital $(168,100$ shares$),,126,075],[$Retained eamings,,$40,000],[$Services revenue,,$159,950],[$Interest revenue,,$250],[$Wages expense,$32,700,],[$Supplies expense,$1,000,],[$Rent expense,$42,950,],[$Advertising expense,$3,300,],[$Depreciation experse: Equipment,$7,500,],[$Insurance expense,$2,200,],[$Income taxes expense,$22,550,],[$$$417,625,$$$417,625$