Prepare JEs and Adjusting (AJEs). I prepared Both journal entries and some Adjusted Entries have been prepared. I wasn't sure how to adjust the journal entry for 1/15 and others. My professor doesn't explain anything, and well this is why im here.

Prepare Income Statement (including OCI) and a Balance Sheet in Good form for 12/31/X1. Prepare closing entries. (if u can show with steps how to do the income statement, balance sheet and closing entries.)

Assume cash transaction in year X1 unless otherwise noted.

1/1 An Investor acquired 100% of Crazy's stock with an investment of $400,000 cash. Per value of stock was 10.00/share and a thousand shares were sold.

Cash 400,000

Common Stock 10,000

Additional Paid in Capital 390,000

1/1 Crazy borrowed $250,000 cash by issuing a 3 year note with a stated interest rate of 10% per year. To be compounded annually. The interest will be paid on maturity.

Cash 250,000

Notes Payable 250,000

12/31 Interest Expense 8,333

Interest Payable 8,333

01/03 Prepaid two years of rent for $24,000 (cash) for the current year. The first month's rent was due 1/1 for January

Prepaid Rent 24,000

Cash 24,000

12/31 Rent Expense 12,000

Prepaid Rent 12,000

01/15 Purchased with cash-office equipment for $36,000 and supplies for for $18,000

Equipment 36,000

Supplies 18,000

Cash 54,000

02/07 Received $150,000 cash for consulting, services to be performed in the future for client X

Cash150,000

Unearned Service Revenue 150,000

03/01 Started up a second line of consulting services. Sold and received $200,000 in total for the year in consulting services and paid related misc. expenses of $50,000. This summarizes all revenues and expense of business #2. All in cash.

Cash 200,000

Service Revenue 200,000

Misc Expense 50,0000

Cash 50,000

07/01 Prepaid $24,000 cash for a 12 month insurance policy (starting on 07/01)

Prepaid Insurance 24,000

Cash 24,000 (im not sure how i would adjust this one, but this is the regular entry)

08/01 Borrowed a $100,000 in cash from bank. Stated rate of interest is 10%. Principal and interest due 07/31/x2

Cash 100,000

Notes Payable 100,000 (IM NOT SURE HOW TO ADJUST THIS ENTRY AS WELL, I KNW ITS INTEREST EXPENSE AND INTEREST PAYABLE, BUT IT SAYS TO CALCULATE EVERYTHING BY 12/31 AND THIS ONE SAYS 07/31 SO I DONT KNOW IF I WOULD CALCULATE THE INTEREST UNTIL THE 12/31? OR FOR 07/31)

09/12 Purchased $5,000 more of supplies on credit

Supplies 5,000

Accounts Payable 5,000

09/16 Provided consulting services of $30,000 on credit to client Y from the main (first line) consulting service division.

Accounts Receivable 30,000

Service Revenue 30,000

10/01 Purchased $10,000 with cash of an investment in another company's (Pear Inc.) stock. Purchased $5,000 in bonds of Pear (not considered trading)

(this one, Im unsure if i did correctly)

Investment Bond 5,000

Investment-Pear Inc 10,000

Cash 15,000

10/20 Collected $5,000 from Client Y

Accounts Receivable 150,000

Service Revenue 150,000

10/31 80% of the services for client X are performed

Unearned Service Revenue 120,000 (wasnt sure how to adjust this one either)

Service Revenue 120,000

12/1 Decided to sell second line of consulting business. Found a buyer for second line of consulting services. Sold the business in exchange for $40,000 worth of equipment; which resulted in a gain of $40,000 as the second line had no assets or liabilities.

Equipment 40,000

Gain on sale of business (2) 40,000

12/15 Paid down the payable (supplies) with a $1,000 cash payment. We received $100,000 cash from client ZA.

Accounts Payable 1,000

cash 1,000

cash 100,000

accounts receivable 100,000

12/31 Counted Supplies and determined that $5,000 of supplies were still on hand

Supplies Expense 18,000

Supplies 18,000

12/31 Total salaries paid in year equaled $35,000. Remaining salaries are to be paid on 1/3/x2. The total amount of current year expense is $45,000. The amount unpaid related to this amount at year end is $10,000.

Salaries Expense 45,000

Cash 35,000

Salaries Pay 10,000

12/31 Determined appropriate total depreciation is $10,000

Depreciation 10,000

Accumulated Depreciation 10,000

12/31 Determined that the stock purchased on 10/1 was now worth $16,000. However, the stock was not sold. Determined the bonds were worth 12,000.

Cash 3,000

Dividend Income 2,000

Interest from Bond 1,000

12/31 We received cash of of $2,000 in dividends from Pearl Inc. We received $1,000 in interest from bonds.

Insurance Expense 12,000

Prepaid Insurance 12,000

(6 months recognized)

TAX RATE IS 21% (NONE OF THE TAX IS PAID, BUT IT IS ACCRUED AS A LIABILITY)