Problem 3-6

The following are the trial balance and the other information related to Vaughn Perez, a consulting engineer.

VAUGHN PEREZ, CONSULTING ENGINEER TRIAL BALANCE DECEMBER 31, 2017
		Debit			Credit
Cash		$29,500
Accounts Receivable		58,000
Allowance for Doubtful Accounts					$686
Supplies		1,750
Prepaid Insurance		1,230
Equipment		30,400
Accumulated Depreciation-Equipment					7,600
Notes Payable					7,200
Owners Capital					34,057
Service Revenue					115,865
Rent Expense (13 months of rent)		8,918
Salaries and Wages Expense		33,340
Utilities Expenses		1,510
Office Expense		760
Totals		$165,408			$165,408

1.		Fees received in advance from clients $6,060, which were recorded as revenue.
2.		Services performed for clients that were not recorded by December 31, $4,990.
3.		Bad debt expense for the year is $1,570.
4.		Insurance expired during the year $483.
5.		Equipment is being depreciated at 10% per year.
6.		Vaughn Perez gave the bank a 90-day, 10% note for $7,200 on December 1, 2017.
7.		Rent of the building is $686 per month. The rent for 2017 has been paid, as has that for January 2018, and recorded as Rent Expense.
8.		Office salaries and wages earned but unpaid December 31, 2017, $2,604.

From the trial balance and other information given, prepare annual adjusting entries as of December 31, 2017. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter 0 for the amounts.)

No.	Account Titles and Explanation	Debit	Credit
1.
2.
3.
4.
5.
6.
7.
8.

SHOW LIST OF ACCOUNTS

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Prepare an income statement for 2017. (Enter loss using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

VAUGHN PEREZ, CONSULTING ENGINEER Income Statement December 31, 2017For the Year Ended December 31, 2017For the Quarter Ended December 31, 2017
DrawingsExpensesNet Income / (Loss)Onwers Capital, January 1Owners Capital, December 31RevenuesTotal ExpensesTotal Revenues
		$
DrawingsExpensesNet Income / (Loss)Onwers Capital, January 1Owners Capital, December 31RevenuesTotal ExpensesTotal Revenues
	$
Drawings Expenses Net Income / (Loss) Onwers Capital, January 1 Owners Capital, December 31 Revenues Total Expenses Total Revenues
DrawingsExpensesNet Income / (Loss)Onwers Capital, January 1Owners Capital, December 31RevenuesTotal ExpensesTotal Revenues		$

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Prepare a statement of owners equity for 2017. VaughnPerez withdrew $18,550 cash for personal use during the year. (List items that increase owner's equity first.)

VAUGHN PEREZ, CONSULTING ENGINEER Statement of Owners Equity December 31, 2017For the Year Ended December 31, 2017For the Quarter Ended December 31, 2017
Owner's DrawingsExpenses Net Income / (Loss) Onwer's Capital, January 1 Owner's Capital, December 31 Revenues Total Expenses Total Revenues	$
Add Less : Owner's DrawingsExpenses Net Income / (Loss) Onwer's Capital, January 1 Owner's Capital, December 31 Revenues Total Expenses Total Revenues
Add Less : Owner's DrawingsExpenses Net Income / (Loss) Onwer's Capital, January 1 Owner's Capital, December 31 Revenues Total Expenses Total Revenues
Owner's DrawingsExpenses Net Income / (Loss) Onwer's Capital, January 1 Owner's Capital, December 31 Revenues Total Expenses Total Revenues	$

SHOW LIST OF ACCOUNTS

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Prepare a classified balance sheet for 2017. (List current assets in the order of liquidity.)

VAUGHN PEREZ, CONSULTING ENGINEER Balance Sheet December 31, 2017For the Year Ended December 31, 2017For the Quarter Ended December 31, 2017
Assets
Current AssetsCurrent LiabilitiesIntangible AssetsLiabilitiesLong-term InvestmentsLong-term LiabilitiesProperty, Plant and EquipmentOwners EquityTotal AssetsTotal Current AssetsTotal Current LiabilitiesTotal Intangible AssetsTotal LiabilitiesTotal Liabilities and Owners EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Owners EquityTotal Property, Plant and Equipment
			$
		$
Add Less :
Current Assets Current Liabilities Intangible Assets Liabilities Long-term Investments Long-term Liabilities Property, Plant and Equipment Owners Equity Total Assets Total Current Assets Total Current Liabilities Total Intangible Assets Total Liabilities Total Liabilities and Owners Equity Total Long-term Investments Total Long-term Liabilities Total Owners Equity Total Property, Plant and Equipment					$
AddLess :
Current Assets Current Liabilities Intangible Assets Liabilities Long-term Investments Long-term Liabilities Property, Plant and Equipment Owners Equity Total Assets Total Current Assets Total Current Liabilities Total Intangible Assets Total Liabilities Total Liabilities and Owners Equity Total Long-term Investments Total Long-term Liabilities Total Owners Equity Total Property, Plant and Equipment					$
Liabilities and Owners Equity
Current AssetsCurrent LiabilitiesIntangible AssetsLiabilitiesLong-term InvestmentsLong-term LiabilitiesProperty, Plant and EquipmentOwners EquityTotal AssetsTotal Current AssetsTotal Current LiabilitiesTotal Intangible AssetsTotal LiabilitiesTotal Liabilities and Owners EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Owners EquityTotal Property, Plant and Equipment
			$
Current AssetsCurrent LiabilitiesIntangible AssetsLiabilitiesLong-term InvestmentsLong-term LiabilitiesProperty, Plant and EquipmentOwners EquityTotal AssetsTotal Current AssetsTotal Current LiabilitiesTotal Intangible AssetsTotal LiabilitiesTotal Liabilities and Owners EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Owners EquityTotal Property, Plant and Equipment					$
Current AssetsCurrent LiabilitiesIntangible AssetsLiabilitiesLong-term InvestmentsLong-term LiabilitiesProperty, Plant and EquipmentOwners EquityTotal AssetsTotal Current AssetsTotal Current LiabilitiesTotal Intangible AssetsTotal LiabilitiesTotal Liabilities and Owners EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Owners EquityTotal Property, Plant and Equipment
Current Assets Current Liabilities Intangible Assets Liabilities Long-term Investments Long-term Liabilities Property, Plant and Equipment Owners Equity Total Assets Total Current Assets Total Current Liabilities Total Intangible Assets Total Liabilities Total Liabilities and Owners Equity Total Long-term Investments Total Long-term Liabilities Total Owners Equity Total Property, Plant and Equipment					$