Joes Flowers
Unadjusted trial Balance
December 31, 2016
	Dr.	Cr.
Cash	$125,600
Investments	300,000
Accounts receivable, 12/31/15	116,200
Allowance for doubtful accounts, 12/31/15		$20,000
Inventory, 12/31/15	62,000
Furniture and Fixtures	118,200
Accumulated depreciation, Furniture & Fixtures 12/31/15		32,400
Accounts payable, 12/31/15		42,000
Capital stock, $10 par value		50,000
Retained earnings, 12/31/15		242,000
Sales		1,549,100
Notes payable 4%, due 3/31/17		200,000
Purchases	906,600
Fencing expense	80,000
Salaries expense	262,000
Income tax expense	45,000
Interest expense		6,000
Insurance expense	34,100
Rent expense	34,200
Utilities expense	12,600
Freight in	15,000
Freight out	17,000
Travel expense	13,000
TOTALS	$2,141,500	$2,141,500

The following information pertains to Joes Flowers Inc., a corporation owned by Ms. Elizabeth Joe. The company opened for business in 2009. Joes uses the cash basis of accounting during the year. Each year, at year end, the companys CPA, Heather McDonald, converts the cash basis books to the accrual basis. The results of any adjustments made on 12/31/15 and any reversing entries made on 1/2/16 are reflected in the unadjusted trial balance below.

Joes Flowers

Unadjusted trial Balance December 31, 2016

Cash $125,600

Investments 300,000

Accounts receivable, 12/31/15 116,200

Allowance for doubtful accounts, 12/31/15 $20,000

Inventory, 12/31/15 62,000

Furniture and Fixtures 118,200

Accumulated depreciation, Furniture & Fixtures 12/31/15 32,400

Accounts payable, 12/31/15 42,000

Capital stock, $10 par value 50,000

Retained earnings, 12/31/15 242,000

Sales 1,549,100

Notes payable 4%, due 3/31/17 200,000

Purchases 906,600

Fencing expense 80,000

Salaries expense 262,000

Income tax expense 45,000

Interest expense 6,000 (credit balance)

Insurance expense 34,100

Rent expense 34,200

Utilities expense 12,600

Freight in 15,000

Freight out 17,000

Travel expense 13,000

TOTALS $2,141,500 $2,141,500

1. Amounts due from customers totaled $175,000 at 12/31/2016.

2. In analyzing amounts due from customers at 12/31/2016, Simmons discovers that Joes has a $6,000 receivable more than 9 months overdue from Jims Retail Store. Simmons discovers that Jims filed for bankruptcy on 12/02/2016 and determines that it is highly unlikely that Joes will recover any of the $6,000 and that the amount should be written off.

3. A further analysis and aging of accounts receivable at 12/31/2016 shows approximately $18,000 of potential uncollectible accounts other than the Jims Retail Store account.

4. Unpaid invoices for flower purchases totaled $42,000 at 12/31/2015 and $54,000 at 12/31/2016.

5. Based on a physical count, the inventory at 12/31/2016 was valued at $52,000.

6. On May 1, 2016, Joes paid $26,100 to renew its comprehensive insurance coverage for one year. The premium on the previous one year policy, which expired on April 30, 2016, was $24,000. The company made the appropriate adjusted entry on 12/31/2015, which was subsequently reversed on 1/2/2016.

7. Joes installed new fencing around the perimeter of the property. The installation was completed on 6/28/2016 at a cost of $80,000. Joe estimates the useful life of the fencing to be 20 years. Joe uses straight-line depreciation.

8. In reviewing the cash receipts journal, Simmons discovers that a piece of furniture purchased on 6/30/2011 for $25,000 being depreciated using the straight-line method with an estimated salvage value of $5,000 and a useful life of 5 years, was sold on March 31, 2016 for $6,000 cash. Unfamiliar with the proper accounting, the bookkeeper debited cash and credit sales for the receipt of the $6,000.

9. The note payable was taken out on 4/1/2015. A proper accrual was made at 12/31/15 and the entry was reversed at 1/2/2016. All principal and interest are due at maturity.

10. On November 15, 2016, one of Joes delivery drivers was in an accident with another vehicle. Unfortunately, the driver had a few beers at lunch and was cited for impaired driving. The company is being sued for $200,000. Fortunately, the comprehensive insurance policy will cover all but the first $40,000. The first court date has been scheduled for Feb. 15, 2017. Joes attorney advises her to settle at the time. The estimated settlement will be between $125,000 and $175,000.

11. All employees are paid weekly on Friday. The average payroll is $5,000 weekly for a 6 day work week. Employees were last paid on 12/31/2016 for the week ended 12/24/2016. Because Joe is Canadian, her policy is to give all employees paid holidays for Christmas Day and the following day, which is known as Boxing Day in Canada. This will be reflected in the paychecks distributed on 1/6/2017.

12. Joes has made estimated tax payments of $15,000 per quarter for the first three quarters of 2014. Joes tax rate is 35% of pretax income.

13. The investments account is comprised of two investments. One $200,000 bond was purchased at face value and Joe intends to hold until it matures. The interest on these bonds are 3% and is paid annually on January 31. Joe purchased these bonds on September 1st of the current year. The fair value of these bonds are $96,000. The other investment are shares of Google stock, which were purchased years ago when Google was selling at $100/share. Assume the closing price of Google on 12/31/16, was $814/share.

Prepare a 10 column worksheet to convert the trial balance to accrual basis of accounting for year ended December 31, 2016. Due 11/10/17