Question:

Steady Answering Service

Trial Balance

December 31,2020

Cash (dr) 21,600

Accounts Receivable (dr) 12,500

Office Supplies (dr) 1,800

Prepaid Insurance (dr) 2,400

Office Equipment (dr) 34,000

Accumulated Depreciation (cr) 6,000

Accounts Payable (cr) 7,000

Unearned Revenue (cr) 4,600

T. Ramos, Capital (cr) 48,700

T. Ramos, Drawing (dr) 4,000

Service Revenue (cr) 29,000

Salary expense (dr) 15,000

Rent Expense (dr) 4,000

Both Total of = 95,300

The following information are also available for the company on December 31,2020

a. Insurance that expired during December amounted to P400

b. Office supplies on hand on December 31 totaled P750

c. Depreciation for December totaled P1,000

d. Accrued wages on December 31 totaled P1,200

e. Revenues earned for services performed in December but not billed by the end of the month totaled P3,000

f. Revenues received in advance of services still to be performed totaled P3,000 at the end of the year

Required: To understand how steady, adjust its revenues and expenses so that its net income is properly measured, complete the following:

1. Determine the required adjusting entries and record them in general journal.

2. Post the entries to the T-accounts . Open a new T-accounts as needed.

3. Make an adjusted trial balance

4. Make an income statement, Statement of Owner's Equity and a balance sheet for the month ended December 31, 2020