I DESPERATELY need help with understanding how to approach this scenario. I've been staring at this for days and none of it makes sense to me. I have tried so many figures for days, and they are all wrong. I dont understand. thank you for any feedback you can give.

Comprehensive Problem Bug-Off Exterminators (Algo)

Bug-Off Exterminators provides pest control services and sells extermination products manufactured by other companies. Following is the company's unadjusted trial balance as of December 31, 2021.

December 31, 2021
	Unadjusted Trial Balance
Debit	Credit
Cash	$ 19,400
Accounts receivable	24,040
Allowance for doubtful accounts		$ 852
Merchandise inventory	15,300
Trucks	44,000
Accumulated depreciationTrucks		0
Equipment	52,200
Accumulated depreciationEquipment		14,240
Accounts payable		5,600
Estimated warranty liability		2,000
Unearned services revenue		0
Interest payable		0
Long-term notes payable		27,000
Common stock		23,000
Retained earnings		63,900
Dividends	22,000
Extermination services revenue		84,000
Interest revenue		896
Sales (of merchandise)		97,826
Cost of goods sold	49,900
Depreciation expenseTrucks	0
Depreciation expenseEquipment	0
Wages expense	47,000
Interest expense	0
Rent expense	21,000
Bad debts expense	0
Miscellaneous expense	1,274
Repairs expense	14,000
Utilities expense	9,200
Warranty expense	0
Totals	$ 319,314	$ 319,314

The following information in a through h applies to the company at the end of the current year.

1. The bank reconciliation as of December 31, 2021, includes the following facts.

Cash balance per bank	$ 16,300
Cash balance per books	19,400
Outstanding checks	2,400
Deposit in transit	3,050
Interest earned (on bank account)	76
Bank service charges (miscellaneous expense)	27

Reported on the bank statement is a canceled check that the company failed to record. (Information from the bank reconciliation allows you to determine the amount of this check, which is a payment on an account payable.)

An examination of customers accounts shows that accounts totaling $691 should be written off as uncollectible. Using an aging of receivables, the company determines that the ending balance of the Allowance for Doubtful Accounts should be $760.

A truck is purchased and placed in service on January 1, 2021. Its cost is being depreciated with the straight-line method using the following facts and estimates.

Original cost	$ 44,000
Expected salvage value	$ 12,800
Useful life (years)	4

Two items of equipment (a sprayer and an injector) were purchased and put into service in early January 2019. They are being depreciated with the straight-line method using these facts and estimates.

	Sprayer	Injector
Original cost	$ 29,400	$ 22,800
Expected salvage value	$ 3,000	$ 3,700
Useful life (years)	8	5

On September 1, 2021, the company is paid $17,100 cash in advance to provide monthly service for an apartment complex for one year. The company began providing the services in September. When the cash was received, the full amount was credited to the Extermination Services Revenue account.

The company offers a warranty for the services it sells. The expected cost of providing warranty service is 2.5% of the extermination services revenue of $72,600 for 2021. No warranty expense has been recorded for 2021. All costs of servicing warranties in 2021 were properly debited to the Estimated Warranty Liability account.

The $27,000 long-term note is an 8%, five-year, interest-bearing note with interest payable annually on December 31. The note was signed with First National Bank on December 31, 2021.

The ending inventory of merchandise is counted and determined to have a cost of $14,100. Bug-Off uses a perpetual inventory system.

Required:

1. Determine amounts for the following items:

1. Correct (reconciled) ending balance of Cash; and the amount of the omitted check.
2. Adjustment needed to obtain the correct ending balance of the Allowance for Doubtful Accounts.
3. Depreciation expense for the truck used during year 2021.
4. Depreciation expense for the two items of equipment used during year 2021.
5. The adjusted 2021 ending balances of the Extermination Services Revenue and Unearned Services Revenue accounts.
6. The adjusted 2021 ending balances of the Warranty Expense and the Estimated Warranty Liability accounts.
7. The adjusted 2021 ending balances of the Interest Expense and the Interest Payable accounts.

2. Use the results of part 1 to complete the six-column table by first entering the appropriate adjustments for items a through g and then completing the adjusted trial balance columns. Hint: Item b requires two adjustments.

3. Prepare journal entries to record the adjustments entered on the six-column table. Assume Bug-Offs adjusted balance for Merchandise Inventory matches the year-end physical count.

4a. Prepare a single-step income statement for 2021.

4b. Prepare the statement of retained earnings (cash dividends during 2021 were $22,000) for 2021.

4c. Prepare a classified balance sheet for December 31, 2021.

Complete this question by entering your answers in the tabs below.

• Req 1
• Req 2
• Req 3
• Req 4A
• Req 4B
• Req 4C

Determine amounts for the following items:

1. Correct (reconciled) ending balance of Cash; and the amount of the omitted check.
2. Adjustment needed to obtain the correct ending balance of the Allowance for Doubtful Accounts.
3. Depreciation expense for the truck used during year 2021.
4. Depreciation expense for the two items of equipment used during year 2021.
5. The adjusted 2021 ending balances of the Extermination Services Revenue and Unearned Services Revenue accounts. Note: Do not round your intermediate calculations.
6. The adjusted 2021 ending balances of the Warranty Expense and the Estimated Warranty Liability accounts.
7. The adjusted 2021 ending balances of the Interest Expense and the Interest Payable accounts.

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a. Reconciled balance of cash	$15,750
a. Omitted check	$1,287
b. Necessary adjustment	$551
c. Depreciation expense	$6,000
	Sprayer	Injector
d. Depreciation expense
	Extermination Services Revenue	Unearned Services Revenue
e. Ending balances after adjustment
	Warranty Expense	Estimated Warranty Liability
f. Ending balances after adjustment
	Interest Expense	Interest Payable
g. Ending balances after adjustment