Q$3.$

Silver Lining, Inc., provides investment advisory services. The company adjusts its accounts monthly, but performs closing entries annually on December $31.$ The firm's unadjusted trial balance dated December $31,$ current year, appears as follows.

$\backslash$table$[[\backslash$table$[[$SILVER LI$],[$Unadjusted$],[$December $3]],$Debits,Credits$],[$Cash$,$$$,51,402,,],[$Accounts receivable,,$2,400,,],[$Office supplies,,$246,,],[$Prepaid rent,,$1,440,,],[$Unexpired insurance,,$324,,],[\backslash$table$[[$Office equipment$],[$Accumulated depreciation office equipment$]],,64,800,$$$,],[\backslash$table$[[$Accumulated depreciation: office equipment$],[$Accounts payable$]],,,,\backslash$table$[[42,300],[1,680]]],[\backslash$table$[[$Accounts payable$],[$Interest payable$]],,,,432],[\backslash$table$[[$Interest payable$],[$Income taxes payable$]],,,,2,100],[,,,,10,800],[\backslash$table$[[$Notes payable$],[$Unearned consulting services revenue$]],,,,4,200],[,,,,\backslash$table$[[36,000],[9600]]],[$Retained earnings,,$1,200,,9,600],[\backslash$table$[[$Dividends$],[$Consulting services revenue$]],,,,72,000],[\backslash$table$[[$Consulting services revenue$],[$Office supplies expense$]],,726,,],[\backslash$table$[[$Office supplies expense$],[$Depreciation expense: office equipment$]],,9,900,,],[,,4,230,,],[,,1,212,,],[\backslash$table$[[$Insurance expense$],[$Salaries expense$]],,32,520,,],[\backslash$table$[[$Salaries expense$],[$Interest expense$]],,432,,],[$Income taxes expense,,$8,280,,],[$Totals$,$$$,179,112,$$$,179,112]]$

Other Data

Accrued but unrecorded and uncollected consulting services revenue totals $$1,800$ at December $31,$ current year.

The company determined that $$3,000$ of previously unearned consulting services revenue had been earned at December $31,$ current year.

Office supplies on hand at December $31$ total $$132.$

The company purchased all of its equipment when it first began business. At that time, the estimated useful life of the equipment was six years $(72$ months$).$

The company prepaid its six$-$month rent agreement on October $1,$ current year.

The company prepaid its $12-$month insurance policy on March $1,$ current year.

Accrued but unpaid salaries total $$2,280$ at December $31,$ current year.

On June $1,$ current year, the company borrowed $$10,800$ by signing a $9-$month, $8$ percent note payable. The entire amount, plus interest, is due on March $1,$ next year.

The company's CPA estimates that income taxes expense for the entire year is $$9,000.$ The unpaid portion of this amount is due early in the next year.

Required:

a$-1.$ Prepare the necessary adjusting journal entries on December $31,$ current year.

a$-2.$ Prepare an adjusted trial balance dated December $31,$ current year.

b$-1.$ From the adjusted trial balance prepared in part a$-2,$ prepare an income statement for the year ended December $31,$ current year.

b$-2.$ From the adjusted trial balance prepared in part a$-2,$ prepare the statement of retained earnings for the year ended December $31,$ current year. b$-3.$ From the adjusted trial balance prepared in part a$-2,$ prepare the company's balance sheet dated December $31,$ current year.

c$.$ Prepare the necessary year$-$end closing entries.

d$.$ Prepare an after$-$closing trial balance.

e$.$ Compute the company's average monthly insurance expense for January and February of current year.

f$.$ Compute the company's average monthly rent expense for January through September of current year.

g$.$ If the company purchased all of its office equipment when it first incorporated, for how long has it been in business as of December $31,$ current year?