Please Help I have no idea where to start! I need to know what questions to ask by looking at the trial balance.

General Journal Entries for Year 5 1) 2/1/x5 Interest Payable $ 25,186.00 Long Term Debt-Notes $ 62,198.00 Cash Record payment of principle and interest on long term notes payable 2) 3/1/x5 Cash $ 1,575,000.00 Capital Stock-Preferred Additional Paid in Capital-Preferred Record issuance of 7,000 shares of preferred stock 3) 5/1/x5 Land Buildings Equipment Cash Record purchase of land and building for warehouse $ $ $ 105,000.00 215,000.00 60,000.00 4) 5/1/x5 Equity Securities Cash Record purchase of equity interest in LS-Pump/Valve $ 1,750,000.00 5) 6/1/x5 Interest Payable Capital Lease Liability Cash Record accrual and payment of rent $ $ 33,835.00 7,165.00 Cash A/R $ $ 492,000.00 2,358,000.00 $ 2,320,000.00 $ 1,360,000.00 $ 1,310,000.00 $ 850,000.00 6) Service Revenue Record revenue from maintenance contracts for the year 7) Cash A/R Record payment on A/R 8) A/R Sales Revenue Record revenue from merchandise sales for the year 9) Cash A/R Record payment on A/R 10) Cost of Goods Sold Merchandise Inventory Record cost of goods for the year 11) Merchandise Inventory A/P-Suppliers Record purchase of merchandise for the year $ 899,700.00 12) Cost of Goods-Air Freight Cash Record payment of air freight for merchandise purchases $ 80,400.00 13) Cost of Goods-Warehouse Rent $ 12,000.00 Cash Record payment of warehouse rent used to store purchased merchandise 14) S&A-Sales Salaries and Commissions $ Cash Record accrual and payment of sales salaries and commissions 15) S&A- Warehouse Wages Cash Record accrual and payment of warehouse wages $ 55,000.00 16) SC-Dir-Crew Wages Cash Record accrual and payment of crew wages $ 1,148,550.00 17) SC-Dir-Shop Wages Cash Record accrual and payment of shop wages $ 138,975.00 18) SC-Dir-Truck Rental Cash Record accrual and payment of truck rental $ 26,000.00 19) SC-Dir-Fuel Cash Record accrual and payment of truck fuel $ 47,000.00 20) SC-Dir_Repairs & Maint Cash Record payment of repairs and maintenance $ 12,500.00 21) SC-Ind-Shop Utilities S&A-Utilities $ $ 40,833.00 8,167.00 142,400.00 Cash Record accrual and payment of utilities 22) Supplies on Hand SC-Ind-Supplies Expense A/P Suppliers Record the purchase of supplies $ $ 1,000.00 60,000.00 23) SC-Dir-Equipment Depreciation Expense A/D-Shop Equipment Record depreciation on shop equipment $ 6,000.00 24) S&A-other S&A-Officers Salaries S&A-Other Salaries S&A-Professional Fees S&A-Office Supplies S&A-Equipment Rent Expense Cash Record accrual and payment of S&A Expenses $ $ $ $ $ $ 31,000.00 140,000.00 116,000.00 9,000.00 15,000.00 8,000.00 25) Cash $ 36,000.00 Recognized Gain-Equity Securities Equity Securities-ST Record sale of trading securities 26) Equity Securities-ST Cash Purchase of trading securities $ 36,000.00 27) A/P Inventoriable Costs A/P Suppliers Cash Record payment of accounts payable $ $ 818,800.00 52,000.00 28) Income Tax Payable Cash Record payment of Income tax $ 203,060.00 29) Allowance for Bad Debt A/R Wrote off specific account in A/R $ 24,800.00 30) Cash $ 37,000.00 Dividend Income Record dividend from LS-Pump/Valve 31) Equity Securities-Long Term $ 368,474.00 Equity Securities Equity Interest Transferred PVCO from Equity Method investment to Cost Method investment 32) Cash $ 39,000.00 Investment Income-Equity Securities-LT Record dividend as income from PVCO 33) 12/23/x5 Retained Earnings-Dividends Cash Record payment of cash dividend $ 92,000.00 34) 12/27/x5 Cash $ 1,800.00 Dividend Income Record dividends received from trading securities 35) 12/31/x5 Capital Lease Liability $ 729.00 LT Debt-Notes $ 7,464.00 ST Portion of LT debt Allocate current position of LT notes payable from noncurrent to current liabilities 36) 12/31/x5 Bad Debt Expense Allowance for Bad Debt Record bad debt expense $ 35,000.00 37) 12/31/x5 Amortization Expense - License Licensing Costs Record amortization of licensing costs $ 6,000.00 38) 12/31/x5 Amortization Expense-Lease $ 19,000.00 Interest Expense Capital Lease $ 33,410.00 Leased Assets-A/D Interest Payable Record accrued interest on capital lease and amortization of capital lease asset 39) 12/31/x5 SC-Dir-Truck Depreciation Expense A/D-Vehicles Record depreciation on trucks $ 48,829.00 40) 12/31/x5 S&A-Warehouse Depreciation Expense A/D-Buildings Record depreciation on the warehouse $ 10,750.00 41) 12/31/x5 Depreciation-Equipment A/D-Equipment Record depreciation on forklifts $ 10,000.00 42) 12/31/x5 Interest Expense Interest Payable Record accrued interest on notes payable for 20X5 $ 18,344.00 43) 12/31/x5 S&A-Medical Benefits Cash Record payment of medical benefits expense $ 115,815.00 44) 12/31/x5 S&A-Pension Expense $ 331,461.00 Accrued Pension Liability $ 28,539.00 Cash Recorded accrual of pension expenses and contribution to the plan 45) 12/31/x5 Net Pension Liability-Long Term OCI- Deferred Pension Cost - Past Service Cost $ 19,879.00 46) 12/31/x5 Equity Securities-ST Market Gain/Loss-ST Securities Adjust trading securities to market $ 17,325.00 47) 12/31/x5 Income Tax Expense Income Tax Payable Record accrual of income tax expense $ 220,107.00 $ 18,152,495.00 $ 87,384.00 $ $ 700,000.00 875,000.00 $ 380,000.00 $ 1,750,000.00 $ 41,000.00 $ 2,850,000.00 $ 2,320,000.00 $ 1,360,000.00 $ 1,310,000.00 $ 850,000.00 $ 899,700.00 $ 80,400.00 $ 12,000.00 $ 142,400.00 $ 55,000.00 $ 1,148,550.00 $ 138,975.00 $ 26,000.00 $ 47,000.00 $ 12,500.00 $ 49,000.00 $ 61,000.00 $ 6,000.00 $ 319,000.00 $ $ 4,000.00 32,000.00 $ 36,000.00 $ 870,800.00 $ 203,060.00 $ 24,800.00 $ 37,000.00 $ 368,474.00 $ 39,000.00 $ 92,000.00 $ 1,800.00 investment $ urrent liabilities 8,193.00 $ 35,000.00 $ 6,000.00 $ $ 19,000.00 33,410.00 $ 48,829.00 $ 10,750.00 l lease asset $ 10,000.00 $ 18,344.00 $ 115,815.00 $ 360,000.00 $ 19,879.00 $ 17,325.00 $ 220,107.00 $ 18,152,495.00 12/31/X4 Acct No Account Title 101 Cash 105 Accounts Receivable 106 Accounts Receivable- Prog Billings 108 Allowance for Bad Debt 111 Equity Securities 121 Merchandise Inventory 122 Work In Progress 123 Manufacturing Costs- Variable 124 Manufacturing Costs- Fixed 125 Raw Materials 126 Construction Work In Progress 127 Construction WIP- Progress Billings 129 Supplies on Hand 141 Deferred Income Tax Asset - Current 142 NOL Tax Benefit 143 NOL Valuation Allowance 151 Land 161 Buildings 162 Buildings - Accumulated Depreciation 171 Equipment 172 Equipment- Accumulated Depreciation 181 Vehicles 182 Vehicles - Accumulated Depreciation 191 Leased Assets 192 Leased Assets- Accumulated Depreciation 201 Equity Securities - Long Term 202 Equity Securities - Equity Interest 211 Licensing Costs, NET 212 Goodwill 215 Deferred Income Tax Asset - Long Term 217 Start-Up Costs 221 Deferred R&D Costs 301 Accounts Payable- Inventoriable Costs 302 Accounts Payable- Suppliers - Other Costs 303 Accounts Payable- Equipment ACQ 311 Interest Payable 312 Income Tax Payable 321 Short-Term Portion of Long Term Debt 325 Deferred Income Tax Liability - Current 331 Notes Payable 335 Unearned Revenue DR(CR) 248,490 146,000 Trial 12/31/X5 DR(CR) ref 92,406 209,200 (30,000) 25,075 116,790 (40,200) 46,400 166,490 20,921 48,278 21,921 ### 30,000 (24,000) 392,286 (148,143) 380,000 (38,000) 105,000 215,000 (10,750) 90,000 (40,000) ### (196,972) ### (57,000) 368,474 1,750,000 - 368,474 6,000 (16,790) (29,000) (42,824) (80,095) (69,363) (97,690) (38,000) (35,557) (97,142) (77,556) (124,000) ### Dr 338 Accrued Pension Liability 401 Long-Term Debt Notes 402 Long-Term Debt Bonds 411 Net Pension Liability - Long-term 415 Capital Leases- Liability 421 Deferred Income Tax Liability - Long Term 422 Estimated Liability- Product Warranties 451 Capital Stock- Common 452 Paid-in Capital Common 461 Capital Stock- Preferred 462 Paid-in Capital Preferred 471 OCI- Market Gain- ST Equity Securities 475 OCI- Deferred Pension Cost - Past Service Cost 476 OCI-Deferred (Gain) Loss 491 Retained Earnings 492 Retained Earnings- Cash Dividends 493 Retained Earnings- Stock Dividends 494 Retained Earnings- Error Correction PY 495 Retained Earnings- Cumulative Effect 501 Sales Revenue 505 Service Revenue 511 Construction Revenue 521 Cost of Goods Sold 522 Air Freight 523 Warehouse Rent 551 Service Costs- Direct- Crew Wages 552 Service Costs- Direct- Truck Rental 553 Service Costs- Direct- Fuel 554 Service Costs- R and M 561 Service Costs- Indirect Shop Wages 562 Service Costs- Indirect Shop Utilities 563 Service Costs- Indirect Shop Rent 564 Service Costs- Indirect Supplies 565 Service Costs- Crew Training 581 Costs of Construction Revenue Earned 601 Selling & Admin- Utilities 602 Selling & Admin- Building Rental 603 Selling & Admin- Medical Benefits 604 Selling & Admin- Pension Expense 605 Selling & Admin- Officers Salaries 606 Selling & Admin- Rent Equipment 607 Selling & Admin- Supplies 608 Selling & Admin- Other Salaries 609 Selling & Admin- Professional Fees 615 Selling & Admin- Other (42,276) (147,684) (13,737) (78,022) (159,034) (325,332) (16,913) (139,155) (317,438) ### (120,000) ### (700,000) (875,000) 159,034 139,155 (268,622) (527,894) 92,000 (135,000) (2,300,000) (1,360,000) (2,850,000) 100,000 850,000 80,400 12,000 1,148,550 26,000 47,000 12,500 138,975 40,833 ### 60,000 ### ### 8,167 115,815 331,461 140,000 8,000 15,000 116,000 9,000 31,000 897,000 39,000 9,000 141,000 37,500 53,000 7,500 83,460 224,700 115,000 5,000 7,000 98,000 10,000 18,000 631 Selling & Admin- Sales Sal & Comm 632 Selling & Admin- Warehouse Wages 651 Selling & Admin- Bad Debts 701 Service Costs- Direct- Truck Depreciation 704 Service Costs Indirect Depreciation Shop Equip 706 Selling & Admin- Warehouse Depreciation 710 Amortization of Licensing Costs 712 Amortization of Capital Leases 713 Amortization of R&D Costs 714 Amortization of Goodwill 751 Interest Expense 755 Interest Expense Capital Lease 801 Market (Loss) Recovery- ST Equity Securities 802 Recognized Gain- Mkt Equity Securities 803 Investment Income- Mkt Equity Securities ST 804 Investment Income- Mkt Equity Securities LT 805 Investment Income Equity Investments 811 Net Unrealized Holding Gain 831 Income Tax Expense - Current 832 Income Tax Expense - Deferred 851 Extraordinary Items 860 Discontinued Operations 62,000 66,381 6,000 6,000 19,000 25,741 34,111 13,125 142,400 55,000 35,000 48,829 16,000 10,750 ### ### (6,474) 18,344 33,410 (17,325) (4,000) (1,800) (39,000) (37,000) 106,204 220,107 (1,520) - - - Spr 2012 Adjusted 12/31/X5 ref Cr DR(CR) 92,406 209,200 (40,200) 46,400 166,490 21,921 48,278 105,000 215,000 (10,750) 90,000 (40,000) 392,286 (196,972) 380,000 (57,000) 368,474 1,750,000 (97,690) (38,000) (35,557) (97,142) (77,556) (124,000) (13,737) (78,022) (139,155) (317,438) (16,913) (120,000) (700,000) (875,000) 139,155 (527,894) 92,000 (1,360,000) (2,850,000) 850,000 80,400 12,000 1,148,550 26,000 47,000 12,500 138,975 40,833 60,000 8,167 115,815 331,461 140,000 8,000 15,000 116,000 9,000 31,000 142,400 55,000 35,000 48,829 16,000 10,750 6,000 19,000 18,344 33,410 (17,325) (4,000) (1,800) (39,000) (37,000) 220,107 - - Hydromaint, Inc. Balance Sheet December 31, 20x5 Assets 20x5 Current Assets Cash Accounts Receivable (net) Equity Securities Merchandise Inventory Supplies on Hand Deferred Income Tax Asset - Current Total Current Assets 92,406 $ 169,000 46,400 166,490 21,921 48,278 544,495 248,490 116,000 25,075 116,790 20,921 48,278 575,554 105,000 215,000 -10,750 90,000 -40,000 392,286 -196,972 380,000 -57,000 877,564 30,000 -24,000 392,286 -148,143 380,000 -38,000 592,143 Other Assets Equity Securities - Long Term Equity Securities - Equity Interest Licensing Costs, NET Total Other Assets 368,474 1,750,000 0 2,118,474 0 368,474 6,000 374,474 Total Assets 3,540,533 1,542,171 $97,690 38,000 35,557 97,142 77,556 124,000 469,945 $16,790 29,000 42,824 80,095 69,363 124,000 362,072 Property, Plant and Equipment Land Buildings Buildings - Accumulated Depreciation Equipment Equipment- Accumulated Depreciation Vehicles Vehicles - Accumulated Depreciation Leased Assets Leased Assets- Accumulated Depreciation Total Property, Plant and Equipment Liabilities and Equity Current Liabilities Accounts Payable- Inventoriable Costs Accounts Payable- Suppliers - Other Costs Interest Payable Income Tax Payable Short-Term Portion of Long Term Debt Unearned Revenue Total Current Liabilities $ 20x4 Long Term Liabilities Accrued Pension Liability Long-Term Debt Notes Capital Leases- Liability Net Pension Liability Deferred Income Tax Liability - Long Term Total Long Term Liabilities 13,737 78,022 317,438 139,155 16,913 565,265 42,276 147,684 325,332 159,034 16,913 691,239 1,035,210 1,053,311 Owner's Equity Capital Stock- Common Capital Stock- Preferred Paid-in Capital Preferred OCI Retained Earnings Total Owner's Equity 120,000 700,000 875,000 -139,155 949,478 2,505,323 120,000 0 0 -159,034 527,894 488,860 Total Liabilities and Owner's Equity 3,540,533 1,542,171 Total Liabilities Hydromaint, Inc. Statement of Income and Retained Earnings For the Year Ending December 31, 20x5 20x5 Revenue Sales Revenue Service Revenue Dividend Income Total Revenue 20x4 $1,360,000 2,850,000 77,800 4,287,800 $135,000 2,300,000 7,994 2,442,994 2,416,258 1,006,843 100,579 (21,325) 51,754 3,554,109 1,276,500 630,660 97,381 13,125 59,852 2,077,518 Operating Income before Taxes 733,691 365,476 Income Tax Expense 220,107 106,204 Net Income 513,584 259,272 527,894 (92000) $949,478 268,622 Costs and Expenses Cost of Goods Sold Selling and Administrative Expenses Depreciation and Amortization Investment (gain) loss Interest Expense Total Costs and Expenses Retained Earnings, January 1 Less Dividends Declared Retained Earnings, December 31 $527,894 Hydromaint Inc. was created in 20x1. Your firm has been working with them since their inception by providing review services each year, as required by their bank. These services have included reviewing the journal entries prepared by the client each year, and making inquiries to the client to understand the methodologies and estimates used. Your firm then proposes adjusting entries to bring the financial statements into compliance with GAAP, and prepared the financial statement footnotes. When Hydromaint was created they were exclusively providing hydraulic maintenance services. As they have grown they began to carry parts in inventory to expedite their maintenance and repair activities. (Previously they would order parts only when needed.) In 20x4 Hydromaint acquired a 20 percent ownership in PVCO, a supplier of high quality pumps and valves. At that time one of the Hydromaint founders was placed on the board of PVCO. You have been provided the journal entries for 20x5, and the income statement and balance sheet that was prepared by the client. (Some of the entries are aggregated for simplicity.) Review the financial information provided, and prepare a list of questions for the client. These questions should address clarification of methods and estimates to allow you to prepare any adjusting entries and footnotes for 20x5