Q.No.5 (5)

Kohinoor Agency. operates a talent agency called Kohinoor Agency. Some clients pay in advance for services; others are billed after services have been performed. Advance payments are credited to an account entitled Unearned Agency Fees. Adjusting entries are performed on a monthly basis. Closing entries are performed annually on December 31. An unadjusted trial balance dated December 31, 2005, follows.

KOHINOOR AGENCY

Unadjusted Trial Balance

December 31, 2005

Cash	$22,105
Fees receivable	33,400
Prepaid rent	1600
Unexpired insurance policies	300
Office supplies	800
Office equipment	18000
Accumulated depreciation-office equipment		15000
Accounts payable		1400
Note payable		6600
Income taxes payable		3400
Unearned agency fees		9000
Capital stock		22000
Retained earnings		11800
Dividends	700
Agency fees earned		48,500
Telephone expense	580
Office supply expense	1250
Depreciation expense-office equipment	2950
Rent expense	6000
Insurance expense	1275
Salaries expense	25640
Income taxes expense	3100
Total	$111,445	$117,700

Other Data

1. Office equipment is being depreciated over 60 months.
2. At December 31, 2005, $2500 of previously unearned agency fees had been earned.
3. Accrued but unrecorded and unpaid salary expense totals $1360 at December 31,2005.
4. The agency pays rent quarterly (every three months). The most recent advance payment of $1800 payment was made November 1, 2005. The next payment of $2400 will be made on February 1, 2006.
5. Accrued but unrecorded and uncollected agency fees earned total $3000 at December 31, 2005.
6. Office supplies on hand at December 31, 2005, total $430.
7. On September 1, 2005, the agency purchased a six-month insurance policy for $900.
8. On December 1, 2005 the agency borrowed $6600 by signing a three-month, 9% note payable. The entire amount borrowed, plus interest, is due March 1, 2006.
9. Accrued income taxes payable for the entire year ending December 31, 2005, total $3900. The full amount is due early in 2006.

Instructions:

1. Prepare a 10-column work sheet for the month ended December 31, 2005.