Instructions:

You are provided with three scenarios below requiring the preparation of adjusting journal entries, ledgers, adjusted trial balance and financial statements. The financial year is January $1$ to December $31.$ All responses should be completed in the Excel sheet provided, using appropriate formulas and formats for accounting.

Scenario $1$: Prepaid Expenses and Depreciation $(40$ points$)$

Your company, 'Tech Innovations', had the following year$-$end balances before any adjustments to the trial balance:

Prepaid Insurance: $$3,000$ for a $12-$month policy starting on July $1.$

Office Equipment: Purchased on January $1$ for $$24,000$ with a useful life of $4$ years and no salvage value.

Capital: $$27,000$

Required:

Prepare the adjusting journal entries for the prepaid insurance and depreciation of office equipment.

Update the ledger accounts for these adjustments. The opening balances should be shown in the ledger accounts.

Scenario $2$: Unearned Revenue and Accrued Expenses $(30$ points$)$

'Tech Innovations' received $$6,000$ on December $1$ for a contract service to be delivered over the next $6$ months.

The company also incurred $$2,500$ in utilities expense for December, to be paid in January.

Required:

Prepare the adjusting journal entries for unearned revenue and accrued utilities expense.

Update the ledger accounts accordingly.

Scenario $3$: Accrued Revenues and Financial Statements $(30$ points$)$

As of December $31,$ 'Tech Innovations' has done work of $$4,000$ in service revenue but will prepare the invoice for the customer in January.

Required:

Prepare the adjusting journal entry for the accrued service revenue.

Using the adjusted trial balance $($to be provided$),$ prepare the Income Statement, Statement of Retained Earnings, and Balance Sheet. URGENT