PQR Company has the following account balances on December 31, 2023:

• Cash: $18,000
• Accounts Receivable: $12,000
• Inventory: $22,000
• Accounts Payable: $8,000
• Salaries Payable: $3,000
• Equipment: $35,000
• Accumulated Depreciation: $10,000
• Notes Payable: $15,000
• Common Stock: $20,000
• Retained Earnings: $31,000

Requirements:

• Prepare a trial balance.
• Prepare adjusting entries for the following:
  • Depreciation expense: $2,500
  • Salaries expense: $3,500
• Prepare an adjusted trial balance.
• Prepare a balance sheet.
• Discuss the importance of preparing financial statements in accordance with GAAP.