QUESTION 1: Balance Day Adjustments (20 marks) Steve Gowen is the sole owner of Adelaide Essential Clinical Supplies. Steve does a lot of the business bookkeeping during the year but he sends information through to Bright Chartered Accountants at the end of the financial year for the Balance Day Adjustments to be completed.

Account Name	Debit ($)	Credit ($)
Cash at Bank	9 500
Accounts Receivable	25 000
Prepaid Insurance	9 000
Property, Plant and Equipment (PP&E)	325 000
Accumulated Depreciation PP&E		30 000
Office Computers	55 000
Accumulated depreciation office computers		15 000
Accounts Payable		15 800
Unearned Sales Revenue		22 000
Bank Loan		68 000
S. Gowen, Capital (1 July 2020)		316 950
S. Gowen, Drawings	17 800
Sales Revenue		380 000
Other Revenue		4 500
Inventory (1 July 2020)	75 200
Purchases	240 600
Purchases Returns and Discount		12 900
Rent Expense	33 000
Gas and Electricity Expense	14 750
Office Cleaning Expense	7 000
Wages and Salaries Expense	36 100
Telephone Expense	3 400
Insurance Expense	8 000
Advertising Expense	5 800
Totals	865 150	865 150

REQUIRED:Assume you are a graduate accountant at Bright Chartered Accountants, and you have been asked to prepare any necessary balance day adjusting journals.

1. The balance in the unearned sales revenue included an amount of $3 000 which had been earned by delivering goods to a customer on 30 June 2021
2. The business sold goods of $22 000 to a customer in June but issued no invoice until 3 July 2021.
3. Accrued wages and salaries of $2 300 are to be paid on 2 July 2021.
4. The business had purchased the Property, Plant and Equipment (PP&E) at cost for $325 000 on 1 July 2019. It has a useful life of ten years with an expected salvage value of $25 000.
5. The business had purchased office computers at cost for $55 000 on 1 January 2019. It has a useful life of five years with an expected salvage value of $5 000.
6. The business paid an annual insurance premium of $9 000 on 1 January 2021.
7. It is estimated that 5% of the 30 June 2021 balance of Accounts Receivable is unlikely to be received.
8. A physical stock-take at 30 June 2021 revealed $72 000 of inventory on hand.
9. The business has not paid an advertising invoice of $6 500 on 30 June 2021.