Problem Description CRL Film Editing Inc. (CRL) is a Boston based film editing company that provides its services for a number of film studios. The business has been in existence for 5 years. CRL's main services include providing film editing services, but they also perform various production and promotional work for clients including small businesses and non-commercial clients. The CRL accountant, Lindsey Gibson, has taken a leave of absence during the 4th quarter 2023 (Q4 runs from October 1, 2023 to December 31,2024) and has requested your assistance in compiling the 4 th quarter financial statements in her absence. You have been provided the following in order to create the 4th quarter CRL financial statements (i.e., December 31, 2023 statements): 1. Opening Trial Balance as of September 30,2023 2. List of Accounts used by CRL (see Opening Trial Balance for this list) 3. Detailed transactions during the quarter as well as required adjustments at the end of the quarter. Required: Please provide the following for CRL. 1. Prepare the journal entries for all transactions including the 18 transactions during the period and the 5 adjusting journal entries. (12 Points) 2. Prepare T Accounts with updated final balances for each account used by CRL (6 Points) 3. Post the T Account balances to create an Adjusted Trial Balance as of December 31, 2023 (6 Points) 4. Create the 3 Financial Statements using the Adjusted Trial Balance for CRL as of December 31, 2023 a. Income Statement (5 Points) b. Statement of SH Equity (2 Points) c. Balance Sheet (5 Points) Opening Trial Balance CRL- 9/30/23 (Note: all 21 accounts used are in this Trial Balance) List of Transactions - regular during the period transactions (10/1/23 to 12/31/23) 1. October 1st - Paid $12,000 in cash for insurance for the upcoming year (10/1/23 to 9/30/24) 2. October 7th Provided film editing services for various customers and received cash, $150,000 3. October 15th Provided film editing services for customers on account, $170,000 4. October 30th Received cash in advance from customers for whom CRL will provide services at a later date. Amount received was $60,000 5. November 1st Receive cash and issue a Notes Payable with the local bank, $100,000 6. November 10th Paid employee salaries in cash, $90,000 7. November 20th Purchased film editing supplies on account, $16,000 8. November 30th - Collected cash from customers that had been on account, $120,000 9. December 7th Paid advertising costs in cash, $20,000 10. December 10th Paid employee salaries in cash, $80,000 11. December 14th Paid on the accounts payable balances related to supplies purchase on November 20th for $16,000 12. December 14th Paid utility costs in cash, $15,000 13. December 18th - Provided film editing services for various customers and received cash, $80,000 14. December 22nd Purchased film editing equipment with cash, $56,000 15. December 29th - Issued additional shares of Common Stock and receive $200,000 cash 16. December 29th - Paid $10,000 in cash for prior Accounts Payable balances 17. December 29th - Paid dividends to shareholders in cash, $20,000 18. December 29th Paid rent in cash for October 1 st thru December 31 st time period, $30,000 Adjusting Entries - 5 transactions at End of Period - Note: 4th quarter is the October 1, 2023 to December 31, 2023 time period (i.e., 3 months). No adjusting entries have been made prior to 12/31/23. 19. December 31st Need to record insurance expense for the 4th quarter (i.e., 3 months of the 12 months that were paid for previously) 20. December 31st Supplies balance on hand at end of 4 th quarter =$10,000. Need to record supplies expense for 4 th quarter. 21. December 31st - The production department informed you that $20,000 of film editing services had been provided in 4 th quarter for customers that had previously paid in advance. Need to record this adjustment. 22. December 31st Salaries incurred, but not yet paid at end of 4 th quarter, $55,000. Need to record salary accrual adjustment. 23. December 31st - Notes Payable of $100,000 has an interest rate of 6% annually. The interest payment is made 1 time per year on October 31st,2024. Need to record interest expense incurred through the end of 4 th quarter. Problem Description CRL Film Editing Inc. (CRL) is a Boston based film editing company that provides its services for a number of film studios. The business has been in existence for 5 years. CRL's main services include providing film editing services, but they also perform various production and promotional work for clients including small businesses and non-commercial clients. The CRL accountant, Lindsey Gibson, has taken a leave of absence during the 4th quarter 2023 (Q4 runs from October 1, 2023 to December 31,2024) and has requested your assistance in compiling the 4 th quarter financial statements in her absence. You have been provided the following in order to create the 4th quarter CRL financial statements (i.e., December 31, 2023 statements): 1. Opening Trial Balance as of September 30,2023 2. List of Accounts used by CRL (see Opening Trial Balance for this list) 3. Detailed transactions during the quarter as well as required adjustments at the end of the quarter. Required: Please provide the following for CRL. 1. Prepare the journal entries for all transactions including the 18 transactions during the period and the 5 adjusting journal entries. (12 Points) 2. Prepare T Accounts with updated final balances for each account used by CRL (6 Points) 3. Post the T Account balances to create an Adjusted Trial Balance as of December 31, 2023 (6 Points) 4. Create the 3 Financial Statements using the Adjusted Trial Balance for CRL as of December 31, 2023 a. Income Statement (5 Points) b. Statement of SH Equity (2 Points) c. Balance Sheet (5 Points) Opening Trial Balance CRL- 9/30/23 (Note: all 21 accounts used are in this Trial Balance) List of Transactions - regular during the period transactions (10/1/23 to 12/31/23) 1. October 1st - Paid $12,000 in cash for insurance for the upcoming year (10/1/23 to 9/30/24) 2. October 7th Provided film editing services for various customers and received cash, $150,000 3. October 15th Provided film editing services for customers on account, $170,000 4. October 30th Received cash in advance from customers for whom CRL will provide services at a later date. Amount received was $60,000 5. November 1st Receive cash and issue a Notes Payable with the local bank, $100,000 6. November 10th Paid employee salaries in cash, $90,000 7. November 20th Purchased film editing supplies on account, $16,000 8. November 30th - Collected cash from customers that had been on account, $120,000 9. December 7th Paid advertising costs in cash, $20,000 10. December 10th Paid employee salaries in cash, $80,000 11. December 14th Paid on the accounts payable balances related to supplies purchase on November 20th for $16,000 12. December 14th Paid utility costs in cash, $15,000 13. December 18th - Provided film editing services for various customers and received cash, $80,000 14. December 22nd Purchased film editing equipment with cash, $56,000 15. December 29th - Issued additional shares of Common Stock and receive $200,000 cash 16. December 29th - Paid $10,000 in cash for prior Accounts Payable balances 17. December 29th - Paid dividends to shareholders in cash, $20,000 18. December 29th Paid rent in cash for October 1 st thru December 31 st time period, $30,000 Adjusting Entries - 5 transactions at End of Period - Note: 4th quarter is the October 1, 2023 to December 31, 2023 time period (i.e., 3 months). No adjusting entries have been made prior to 12/31/23. 19. December 31st Need to record insurance expense for the 4th quarter (i.e., 3 months of the 12 months that were paid for previously) 20. December 31st Supplies balance on hand at end of 4 th quarter =$10,000. Need to record supplies expense for 4 th quarter. 21. December 31st - The production department informed you that $20,000 of film editing services had been provided in 4 th quarter for customers that had previously paid in advance. Need to record this adjustment. 22. December 31st Salaries incurred, but not yet paid at end of 4 th quarter, $55,000. Need to record salary accrual adjustment. 23. December 31st - Notes Payable of $100,000 has an interest rate of 6% annually. The interest payment is made 1 time per year on October 31st,2024. Need to record interest expense incurred through the end of 4 th quarter