Instructions Selected account balances before adjustment for Atlantic Coast Realty at July 31, the end of the current year, are as follows: Credits Debits $ 70,300 345,500 $115,400 9,100 3,140 Accounts Receivable Equipment Accumulated DepreciationEquipment Prepaid Rent Supplies Wages Payable Unearned Fees Fees Earned Wages Expense Rent Expense 13,700 652,200 314,300 Depreciation Expense Supplies Expense Data needed for year-end adjustments are as follows: Unbilled fees at July 31, $11,950. Supplies on hand at July 31, $890. Rent expired, $5,600 Depreciation of equipment during year, $8,750. Unearned fees at July 31, $2,040. . Wages accrued but not paid at July 31, 84.680. Required: 1. Journalize the six adjusting entries required at July 31, based on the data presented. Refer to the Chart of Accounts for exact wording of account titles. 2. What would be the effect on the income statement if the adjustments for unbilled fees and accrued wages were omitted at the end of the year? 3. What would be the effect on the balance sheet if the adjustments for unbilled fees and accrued wages were omitted at the end of the year? 4. What would be the effect on the "Net increase or decrease in cash" on the statement of cash flows if the adjustments for unbilled fees and accrued wages were omitted at the end of the year? Chart of Accounts CHART OF ACCOUNTS Alantic Coast Realty General Ledger REVENUE 41 Fees Earned 42 Rent Revenue ASSETS 11 Cash 12 Accounts Receivable 13 Supplies 14 Prepaid Rent 15 Land 16 Equipment 17 Accumulated Depreciation-Equipment EXPENSES 51 Advertising Expense 52 Insurance Expense 53 Rent Expense 54 Wages Expense 55 Supplies Expense 56 Utilities Expense 57 Depreciation Expense 59 Miscellaneous Expense LIABILITIES 21 Accounts Payable 22 Unearned Fees 23 Wages Payable 24 Taxes Payable EQUITY 31 Owner's Equity 32 Withdrawals Journal 1. Journalize the six adjusting entries required at July 31, based on the data presented. Refer to the Chart of Accounts for exact wording of account titles. PAGE 10 JOURNAL ACCOUNTING EQUATION DATE DESCRIPTION POST. REF DEBIT CREDIT ASSETS LIABILITIES EQUITY 1 Adjusting Entries 2 3 4 5 7 8 9 10 11 12 etangulares 13 Final Questions 2. What would be the effect on the income statement if the adjustments for unbilled fees and accrued wages were omitted at the end of the year? Over/Understated Amount Fees earned Wages expense Net income $ Understated Overstated No effect 3. What would be the effect on the balance sheet if the adjustments for unbilled fees and accrued wages were omitted at the end of the year? Over/Understated Amount S Accounts receivable Total assets Wages payable Total liabilities Owner's equity Total liabilities and owner's equity S $ 4. What would be the effect on the "Net increase or decrease in cash" on the statement of cash flows if the adjustments for unbilled fees and accrued wages were omitted at the end of the year
