Please reference the textbook entries found below, and then use excel in the format of the above financial statements according to the textbook's instructions, thanks. Please include the excel functions used to obtain your answers - Thank you so much. You may disregard F. and G. unless you have corrections, as they have been already answered. Also to note; I'm primarily looking for the general ledger, adjusted entries, income statement, and closing statements. I understand that doing any more than this would be asking too much for one question - I just wasn't sure how else to format this. Please complete what you can and I will give you a thumbs up for good work - thanks again!

D E D G COMPREHENSIVE PROBLEM 1 SUSQUEHANNA EQUIPMENT RENTALS General Journal December Daily Transactions A B C 1 5 to 6 hours, Strong 2 3 4 Ja. 5 6 7 Year 1 8 Dec 1 9 10 11 12 1 13 14 15 16 17 1 19 20 21 22 23 4 18 24 25 26 27 28 29 30 8 31 12 32 33 34 35 36 37 38 39 40 41 42 15 43 17 23 44 45 46 47 48 49 50 51 52 53 26 CP1 H.. CP1(p.2) CP1(p.3) CP1(p.4) | CP1(p.5) | CP1(p.6) CP1 Ready C D . 1 E F LG COMPREHENSIVE PROBLEM 1 SUSQUEHANNA EQUIPMENT RENTALS (continued) 2 General Journal December Daily Transactions 3 4 a. 5 6 7 Year 1 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 A B D . 1 E F G COMPREHENSIVE PROBLEM 1 SUSQUEHANNA EQUIPMENT RENTALS (continued) a. General Journal (Adjusting Entries) Year 1 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 32 33 34 35 36 37 38 39 40 41 42 B D . 1 E F G COMPREHENSIVE PROBLEM 1 SUSQUEHANNA EQUIPMENT RENTALS (continued) Retained Earnings Explanation Debit Credit Balance 2 3 4 a. & d. 5 Date 6 7 8 9 10 11 12 13 14 15 16 17 18 19 21 22 23 24 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 CP1(p.7) | CP1 | CP1(p.2) CP1(p.3) CP1(p.4) | CP1(p.5) | CP1(p.6) H.. CP1(p.8 A B C N O D E F G H SUSQUEHANNA EQUIPMENT RENTALS Worksheet December 31, Year 1 J K L M M COMPREHENSIVE PROBLEM 1 SUSQUEHANNA EQUIPMENT RENTALS (continued) Trial Balance Debit Credit Adjustments Debit Credit Adjusted Trial Balance Debit Credit Income Statement Debit Credit Balance Sheet Debit Credit $ 78,000 10,080 14,400 11,520 1,200 288,000 $ 120,000 2,040 9,600 2,400 240,000 2,400 1 2 3 5 5 la. 6 7 8 Balance sheet accounts: 9 Cash 10 Accounts receivable 11 Prepaid rent 12 Unexpired insurance 13 Office supplies 14 Rental equipment 15 Notes payable 16 Accounts payable 17 Unearned rental fees 18 Dividends payable 19 Capital stock 20 Retained earnings 21 Dividends 22 Interest payable 23 Accum. Dep.: rental equip. 24 Salaries payable 25 Income taxes payable 26 Income statement accounts: 27 Rental fees earned 28 29 Salaries expense 30 Maintenance expense 31 Utilities expense 32 33 Rent expense 34 Interest expense 35 Depreciation expense 36 Office supplies expense 37 Income taxes expense 38 39 Net income 40 Totals 41 * Adjustments 42 43 44 15 45,600 12,480 720 840 $ 419,640 $ 419,640 F G H H K No A C D E 4 b. 5 SUSQUEHANNA EQUIPMENT RENTALS Income Statement 7 For the Year Ended December 31, Year 1 8 Revenue: 9 Rental fees earned 10 Expenses 11 Salaries expense 12 Maintenance expense 13 Utilities expense 14 Rent expense 15 Office supplies expense 16 Depreciation expense 17 Interest expense 18 Income before income taxes expense 19 Income taxes expense @ 40% 20 Net income 21 22 23 24 SUSQUEHANNA EQUIPMENT RENTALS 25 Statement of Retained Earnings 26 For the Year Ended December 31, Year 1 27 Retained earnings, December 1, Year 1 28 Net income 29 Subtotal 30 Less: Dividends 31 Retained earnings, December 31, Year 1 32 33 34 35 36 37 38 39 40 41 42 H . 2 D F G 1 COMPREHENSIVE PROBLEM 1 2 SUSQUEHANNA EQUIPMENT RENTALS 3 (continued) 4 b. 5 SUSQUEHANNA EQUIPMENT RENTALS Balance Sheet 7 December 31, Year 1 8 Assets 9 Cash 10 Accounts Receivable 11 Prepaid rent 12 Unexpired insurance 13 Office supplies 14 Rental equipment 15 Less: Accumulated depreciation 16 Total assets 17 18 Liabilities & Stockholders' Equity 19 Liabilities: 20 Notes payable 21 Accounts payable 22 Interest payable 23 Salaries payable 24 Dividends payable 25 Unearned rental fees 26 Income taxes payable 27 Total liabilities 28 Stockholders' equity: 29 Capital stock Retained earnings 31 Total Stockholders' Equity 32 Total liabilities and stockholders' equity 33 34 c. Notes to the financial statements: 30 36 A . A D E G 1 COMPREHENSIVE PROBLEM 1 SUSQUEHANNA EQUIPMENT RENTALS (continued) 4 d. 5 General Journal 6 (Closing Entries) 7 Year 1 8 Dec 31 Rent Fees Earned 9 Income Summary 10 To close the revenue account. 11 12 31Income Summary 13 Salaries Expense 14 Maintenance Expense 15 Utilities Expense 16 Rent Expense 17 Office Supplies Expense 18 Depreciation Expense 19 Interest Expense 20 Income Taxes Expense 21 To close the expense accounts. 22 23 31 Income Summary 24 Retained Earnings 25 To close the Income Summary account. 26 31 Retained Earnings Dividends To close the Dividends account. 30 33 SUSQUEHANNA EQUIPMENT RENTALS 34 After-Closing Trial Balance 35 December 31, Year 1 36 Cash 37 Accounts receivable 38 Prepaid rent 39 Unexpired insurance 40 Office supplies 41 Rental equipment 42 Accumulated depreciation: rental equipment 43 Notes payable 44 Accounts payable 45 Interest payable 46 Salaries payable 47 Dividends payable 48 Unearned rental fees 49 Income taxes payable 50 Capital stock 51 Retained earnings 52 Totals 54 . | CP1 CP1(p.2) CP 1(p.3) | CP1(p.4) | CP1(0.5) | CP1(p.6) | CP 1(p.7) | CP COMPREHENSIVE PROBLEM 1 Susquehanna Equipment Rentals Page 247 A COMPREHENSIVE ACCOUNTING CYCLE PROBLEM On December 1, Year 1, John and Patty Driver formed a corporation called Susquehanna Equipment Rentals. The new corporation was able to begin operations immediately by purchasing the assets and taking over the location of Rent-It, an equipment rental company that was going out of business. The newly formed company uses the following accounts. Cash Accounts Receivable Prepaid Rent Unexpired Insurance Office Supplies Rental Equipment Accumulated Depreciation: Rental Equipment Notes Payable Accounts Payable Interest Payable Salaries Payable Dividends Payable Unearned Rental Fees Income Taxes Payable Capital Stock Retained Earnings Dividends Income Summary Rental Fees Earned Salaries Expense Maintenance Expense Utilities Expense Rent Expense Office Supplies Expense Depreciation Expense Interest Expense Income Taxes Expense The corporation performs adjusting entries monthly. Closing entries are performed annually on December 31. During December of its first year of operations, the corporation entered into the following transactions. The corporation performs adjusting entries monthly. Closing entries are performed annually on December 31. During December of its first year of operations, the corporation entered into the following transactions. Dec. 1 Issued to John and Patty Driver 20,000 shares of capital stock in exchange for a total of $240,000 cash. Dec. 1 Purchased for $288,000 all of the equipment formerly owned by Rent-It. Paid $168,000 cash and issued a 1-year note payable for Dec. 1 Paid $14,400 to Shapiro Realty as three months' advance rent on the rental yard and office formerly occupied by Rent-It. Dec.4 Purchased office supplies on account from Modern Office Co., $1,200. Payment due in 30 days. These supplies are expected to Dec. 8 Received $9,600 cash as advance payment on equipment rental from McNamer Construction Company. (Credit Unearned Rent Dec. 12 Paid salaries of $6,240 for the first two weeks in December. Dec. 15 Excluding the McNamer advance, equipment rental fees earned during the first 15 days of December amounted to $21,600, of w Dec. 17 Purchased on account from Earth Movers, Inc., $720 in parts needed to perform basic maintenance on a rental tractor. Payment Dec. 23 Collected $2,400 of the accounts receivable recorded on December 15. Dec. 26 Rented a backhoe to Mission Landscaping at a price of $300 per day, to be paid when the backhoe is returned. Mission Landsca Dec. 26 Paid biweekly salaries, $6,240. Dec. 27 Paid the account payable to Earth Movers, Inc., $720. Dec. 28 Declared a dividend of 12 cents per share, payable on January 15, Year 2. Dec. 29 Susquehanna Equipment Rentals was named, along with Mission Landscaping and Collier Construction, as a co-defendant in a : Dec. 29 Purchased a 12-month public liability insurance policy for $11,520. This policy protects the company against liability for injuries Dec. 31 Received a bill from Universal Utilities for the month of December, $840. Payment is due in 30 days. Dec. 31 Equipment rental fees earned during the second half of December amounted to $24,000, of which $18,720 was received in cash. The corporation performs adjusting entries monthly. Closing entries are performed annually on December 31. During December of its first year of operations, the corporation entered into the following transactions. exchange for a total of $240,000 cash. Lent-It. Paid $168,000 cash and issued a 1-year note payable for $120,000. The note, plus all 12 months of accrued interest, are due Novemt the rental yard and office formerly occupied by Rent-It. ,200. Payment due in 30 days. (These supplies are expected to last for several months; debit the Office Supplies asset account.) om McNamer Construction Company. (Credit Unearned Rental Fees.) uring the first 15 days of December amounted to $21,600, of which $14,400 was received in cash. ded to perform basic maintenance on a rental tractor. Payment is due in 10 days. er 15. day, to be paid when the backhoe is returned. Mission Landscaping expects to keep the backhoe for about two or three weeks. Year 2. Landscaping and Collier Construction, as a co-defendant in a $30,000 lawsuit filed on behalf of Kevin Davenport. Mission Landscaping ha 1. This policy protects the company against liability for injuries and property damage caused by its equipment. However, the policy goes into 1, $840. Payment is due in 30 days. amounted to $24,000, of which $18,720 was received in cash. The corporation performs adjusting entries monthly. Closing entries are performed annually on December 31. During December of its first year of operations, the corporation entered into the following transactions. due November 30, Year 2. ) ndscaping had left the rented backhoe in a fenced construction site owned by Collier Construction. After working hours on December 26, licy goes into effect on January 1, Year 2, and affords no coverage for the injuries sustained by Kevin Davenport on December 26. The corporation performs adjusting entries monthly. Closing entries are performed annually on December 31. During December of its first year of operations, the corporation entered into the following transactions. ar 2. rented backhoe in a fenced construction site owned by Collier Construction. After working hours on December 26, Davenport had climbe n January 1, Year 2, and affords no coverage for the injuries sustained by Kevin Davenport on December 26. Page 248 The corporation performs adjusting entries monthly. Closing entries are performed annually on December 31. During December of its first year of operations, the corporation entered into the following transactions. ne fence to play on parked construction equipment. While playing on the backhoe, he fell and broke his arm. The extent of the company's li ny's legal and financial responsibility for this accident, if any, cannot be determined at this time. (Note: This event does not require a journa is time. (Note: This event does not require a journal entry at this time, but may require disclosure in notes accompanying the statements.) Data for Adjusting Entries in Year 1 a. The advance payment of rent on December 1 covered a period of three months. b. The annual interest rate on the note payable to Rent-It is 6 percent. c. The rental equipment is being depreciated by the straight-line method over a period of eight years. Any salvage value at the end of its useful life is expected to be negligible and immaterial. d. Office supplies on hand at December 31 are estimated at $720. e. During December, the company earned $4,440 of the rental fees paid in advance by McNamer Construction Company on December 8. f. As of December 31, six days' rent on the backhoe rented to Mission Landscaping on December 26 has been earned. g. Salaries earned by employees since the last payroll date (December 26) amounted to $1,680 at month-end. h. It is estimated that the company is subject to a combined federal and state income tax rate of 40 percent of income before income taxes (total revenue minus all expenses other than income taxes). These taxes will be payable in Year 2. Instructions a. Perform the following steps of the accounting cycle for the month of December, Year 1. 1. Journalize the December transactions. Do not record adjusting entries at this point. 2. Post the December transactions to the appropriate ledger accounts. 3. Prepare the unadjusted trial balance columns of a 10-column worksheet for the year ended December 31. 4. Prepare the necessary adjusting entries on December 31. 5. Post the December adjusting entries to the appropriate ledger accounts. 6. Complete the 10-column worksheet for the year ended December 31. b. Prepare an income statement and statement of retained earnings for the year ended December 31, and a balance sheet as of December 31, Year 1. Page 249 c. Prepare required disclosures to accompany the financial statements dated December 31, Year 1. Your disclosures should include separate write-ups addressing each of the following areas: (1) depreciation policy, (2) maturity dates of major liabilities, and (3) potential liability due to pending litigation. d. Prepare closing entries and post them to ledger accounts. e. Prepare an after-closing trial balance as of December 31, Year 1. d. Prepare closing entries and post them to ledger accounts. e. Prepare an after-closing trial balance as of December 31, Year 1. f. During December, the company's cash balance fell from $240,000 to $78,000. Does this imply that the business is headed for insolvency in the near future? Explain your reasoning. g. Would it be ethical for Patty Driver to maintain the accounting records for this company, or must they be maintained by someone who is independent of the organization