Mastery Problem: The Adjusting Process. Unadjusted Financial Statements These financial statements were prepared from the unadjusted trial balance. Cole Designs Inc. Income Statement For the Year Ended December 31, 20Y3 Fees earned Wages expense Net income Cash Accounts receivable Supplies Prepaid insurance Office equipment Total assets Unearned fees $69,400 (44,150) $25,250 Cole Designs Inc. Balance Sheet December 31, 20Y3 Assets Liabilities Stockholders' Equity Common stock Retained earnings Total liabilities and stockholders' equity $5,250 31,200 3,500 3,600 11,000 $54,550 $8,900 $12,000 33,650 45,650 $54,550 Adjusted Financial Statements These financial statements were prepared from the adjusted trial balance. Cole Designs Inc. Income Statement For the Year Ended December 31, 20Y3 Fees earned $75,250 Expenses: Wages expense $46,450 Supplies expense 3,430 Insurance expense 1,800 Depreciation expense 1,400 Total expenses (53,080) Net income $22,170 Cash Accounts receivable Supplies Prepaid insurance Office equipment Cole Designs Inc. Balance Sheet December 31, 20Y3 Assets Accumulated depreciation-office equipment Total assets $5,250 31,650 70 1,800 $11,000 (1,400) 9,600 $48,370 Liabilities Wages payable Unearned fees Total liabilities $2,300 3,500 $5,800 Stockholders' Equity Common stock $12,000 Retained earnings 30,570 42,570 Total liabilities and stockholders' equity $48,370 Adjusting Entries Journalize the six December 31 adjusting entries for Cole Designs Inc. that adjusted the accounts to arrive at If an amount box does not require an entry, leave it blank. Dec. 31 Accounts Receivable Fees Earned 550 X 550 X Dec. 31 Supplies Expense Supplies Dec. 31 Insurance Expense Prepaid Insurance 3,415 X 3,415 X 3,200 X 3,200 X Dec. 31 Depreciation Expense 1,600 X Accumulated Depreciation-Office Equipment 1,600 X Dec. 31 Wages Expense Wages Payable Dec. 31 Unearned Fees Fees Earned 2,450 X 2,450 X 5,100 X 5,100 X