Required:

(a) Prepare the necessary adjusting entries in the general journal for the year ended 30 June 2020. Narrations are not required. (8 marks)

(b) Prepare an income statement for the year ended 30 June 2020. (9 marks)

Brighton Ltd has unadjusted trial balance as follows on 30 June 2020. Debit Credit t de do de + Cash at banke Accounts receivable Prepaid insurance Office supplies Motor vehicles Accumulated depreciation - Motor vehicles Equipment- Accumulated depreciation - Equipment Accounts payable- Bank loan- Unearned rental revenue- Capitale Drawings Rental revenue- Salaries expense Repairs and maintenance expense Office supplies expense- Electricity expense- Totals 20,8204 6,8004 5,2004 1,2004 108,0004 45,000 44 2,8504 1,1204 7,9004 42,1004 1,15042 45,6004 13,1004 55,2004- 24,20041 4,1004 9,900 1,900+ 198,070 198,07042 H Additional information: 1. Depreciation on the motor vehicles is on the straight-line method with a useful life of 12 years and scrap value of $4,800. 2. Depreciation on the equipment is on the reducing-balance method with a depreciation rate of 20% and scrap value of $300.- 3. Expired insurance amounted to $4,500. 4. A physical stocktake has determined that office supplies on hand amounted to $700.- 5. The balance in the unearned rental revenue account includes $350 for services provided on 25 June 2020. 6. Salaries earned but not paid amounted to $2,500.- 7. Accrued interest on the bank loan is $4,100. 8. Electricity expense for June of $275 has not been paid for or recorded at 30 June 2020