Month-end adjustment data Adjustment data at January 31, 2020. a. Accrued service revenue at January 31,$2,500. b. Prepaid rent expired during the month. The unadjusted prepaid balance of $2,400 relates to the period January through March. c. Supplies used during January, $2,600. d. Depreciation on furniture for the month. The estimated useful life of the furniture is three years. e. Accrued salary expense at January 31 for Monday, Tuesday, and Wednesday. The five-day weekly payroll of $5,400 will be paid on Friday, February 2 . Requirement 1. Using the worksheet, prepare the adjusted trial balance of London Ltd. at January 31, 2020. The unadjusted balances have been entered for you. Key each adjusting entry by letter. Calculate the adjusted balance of each account, and then total the debit and credit columns in the adjusted trial balance. (Leave unused cells blank. Round your answers to the nearest whole number.) \begin{tabular}{|l|r||r||} Furniture & 37,800 & \\ \hline Accumulated depreciation & & 3,000 \\ Accounts payable & & 13,000 \\ Salary payable & & \\ Share capital & & 21,000 \\ Retained earnings & 3,700 & \\ Dividends & & 19,000 \\ Service revenue & 200 \\ Salary expense & & \\ Rent expense & 1,400 & \\ Utilities expense & & \\ Depreciation expense & & \\ Supplies expense & & \\ \hline \end{tabular} Total =78,200 Requirement 2. Prepare the monthly income statement, the statement of retained earnings, and the classified balance si Begin by preparing the income statement. (Use parentheses or a minus sign for a net loss.) Total expenses Net income (loss) Now prepare the statement of retained earnings. (Complete all answer boxes. Use a minus sign or parentheses for numbers to be subtracted.) depreciation.) Total current assets Total current liabilities Shareholders' Equity accounting equation? London net income dividends for the month. Continuation of this trend will both the assets and the shareholders' equity (retained earnings) of the business. b. Will the trend make it easier or more difficult for London to borrow money if the business gets in a bind and needs cash? Why? This trend will make it because more and more will be available for the business to pay debts as they come due. c. Does either the current ratio or the cash position suggest the need for immediate borrowing? Explain. (Round the current ratio to two decimal places, X.XX.) The current ratio is with a ratio of that the business will need to borrow. With a cash position of $ London cover all the current liabilities
