QUESTION 1 (40 POINTS) Green Grass, Inc., provides lawn and tree care services in Charleston, WV. The company adjusts its accounts monthly, but performs closing entries annually on December 31. The firm's unadjusted trial balance dated December 31, 2020, appears as follows GREEN GRASS, INC. URADJUSTED TRIAL BALANCE DECEMBER 1.2020 C 5510 Helios Propard Trexpirence MC Restanddele Accounts payable spalle Income taxes payable Noesale Indong 200 50.000 Dividende Come ricette Dipinap Deprecate capete ufficient REN Nale Income Total SIE SINE Other Data Accrued but unrecorded and uncollected consulting services revenue totals $1,800 at December 31, 2020. 2. The company determined that $3,000 of previously uncared consulting services revenue had been cared at December 31. 2020 3. Office supplies on hand at December 31 total 132. 4. 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). 5. The company prepaid its six-month rent agreement on October 1. 2020. 6. The company prepaid its 12-month insurance policy on March 1, 2020 7. Accrued but unpaid salaries total $2,280 at December 31, 2020 8. 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, 2021. 9. 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 2021 Other Data 1. Accrued but unrecorded and uncollected consulting services revenue totals $1,800 at December 31, 2020. 2. The company determined that $3,000 of previously unearned consulting services revenue had been earned at December 31, 2020. 3. Office supplies on hand at December 31 total $132. 4. 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). 5. The company prepaid its six-month rent agreement on October 1, 2020. 6. The company prepaid its 12-month insurance policy on March 1, 2020. 7. Accrued but unpaid salaries total $2,280 at December 31, 2020. 8. 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, 2021. 9. 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 2021. Instructions a. Prepare the necessary adjusting journal entries on December 31, 2020. Prepare also an adjusted trial balance dated December 31, 2020. b. From the adjusted trial balance prepared in part a, prepare an income statement and statement of retained earnings for the year ended December 31, 2020. Also prepare the company's balance sheet dated December 31, 2020. 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 2020. f. Compute the company's average monthly rent expense for January through September of 2020. 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, 2020
