la FILE PUS 5.500 P3-10 (L02,3,5,6) (Adjusting and Closing) Presented below is the December 31 trial balance of New York Boutique 1000 Credit 5112.900 $ 700 NEW YORK BOUTIQUE TRIAL BALANCE DECEMBER 31 Debit Cash $ 18,500 Accounts Receivable 32,000 Allowance for Doubtful Accounts Inventory, December 31 80.000 Prepaid Insurance 5,100 Equipment 84.000 Accumulated Depreciation Equipment Notes Payable Common Stock Retained Earnings Sales Revenue Cost of Goods Sold 408,000 Salaries and Wages Expense (sales) 50,000 Advertising Expense 6,700 Salaries and Wages Expense (administrative) 65,000 Supplies Expense 5,000 5754,80 ber 31, and a classified bal- 35,000 28,000 80,600 10.000 600,000 es and Wages Payable on elfClub, Inc. as of Decem- $734,00 $754,300 Instructions (a) Construct T-accounts and enter the balances shown. (b) Prepare adjusting journal entries for the following and post to the T-accounts. (Omit explanations.) Open additional T-accounts as necessary. (The books are closed yearly on December 31.) (1) Bad debt expense is estimated to be $1,400. (2) Equipment is depreciated based on a 7-year life (no salvage value). (3) Insurance expired during the year $2,550. (4) Interest accrued on notes payable $3,360. (5) Sales salaries and wages earned but not paid $2,400. (6) Advertising paid in advance $700, (7) Office supplies on hand $1,500, charged to Supplies Expense when purchased. (0) Prepare closing entries and post to the accounts