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Wells Technical Institute $($WTI$),$ a school owned by Tristana Wells, provides training to individuals who pay tuition directly to the school. WTI also offers training to groups in off$-$site locations. WTI initially records prepaid expenses and unearned revenues in balance sheet accounts. Its unadjusted trial balance as of December $31$ follows, along with descriptions of items a through h that require adjusting entries on December $31.$

Additional Information Items

An analysis of WTI's insurance policies shows that $$3,732$ of coverage has expired.

An inventory count shows that teaching supplies costing $$3,235$ are available at year$-$end.

Annual depreciation on the equipment is $$14,929.$

Annual depreciation on the professional library is $$7,464.$

On September $1,$ WTI agreed to do five courses for a client for $$3,000$ each. Two courses will start immediately and finish before the end of the year. Three courses will not begin until next year. The client paid $$15,000$ cash in advance for all five courses on September $1,$ and WTI credited Unearned Revenue.

On October $15,$ WTI agreed to teach a four$-$month class $($beginning immediately$)$ for an executive with payment due at the end of the class. At December $31,$ $$10,850$ of the tuition revenue has been earned by WTI.

WTI's two employees are paid weekly. As of the end of the year, two days' salaries have accrued at the rate of $$100$ per day for each employee.

The balance in the Prepaid Rent account represents rent for December.

Prepare the necessary adjusting journal entries for items a through h$.$ Assume that adjusting entries are made only at year$-$end.

TRANSACTIONS

An analysis of WTI's insurance policies shows that $$3,732$ of coverage has expired.

An inventory count shows that teaching supplies costing $$3,235$ are available at year$-$end.

Annual depreciation on the equipment is $$14,929.$

Annual depreciation on the professional library is $$7,464.$

On September $1,$ WTI agreed to do five courses for a client for $$3,000$ each. Two courses will start immediately and finish before the end of the year. Three courses will not begin until next year. The client paid $$15,000$ cash in advance for all five courses on September $1,$ and WTI credited Unearned Revenue.

On October $15,$ WTI agreed to teach a four$-$month class $($beginning immediately$)$ for an executive with payment due at the end of the class. At December $31,$ $$10,850$ of the tuition revenue has been earned by WTI.

WTI's two employees are paid weekly. As of the end of the year, two days' salaries have accrued at the rate of $$100$ per day for each employee.

The balance in the Prepaid Rent account represents rent for December.

$2.$ Post the balance from the unadjusted trial balance and the adjusting entries into the T$-$accounts for the following: T$-$account for Cash, Equipment, accounts receivable, accumulated depreciation$-$equipment, teaching supplies, accounts payable, prepaid insurance, salaries payable, prepaid rent, unearned revenue, professional library, common stock, accumulated depreciation$-$ professional library, retained earnings, tuition revenue, dividends, training revenue, rent expense, depreciation expense$-$professional library, teaching supplies expense, depreciation expense$-$ equipment, advertising expense, salaries expense, utilities expense and insurance Expense.

$3-$a$.$ Prepare Wells Technical Institute's income statement for the year.

$3-$b$.$ Prepare Wells Technical Institute's statement of retained earnings for the year. The Retained Earnings account balance was $$84,000$ on December $31$ of the prior year.

$3-$c$.$ Prepare Wells Technical Institute's balance sheet as of December $31\backslash$table$[[\backslash$table$[[$WELLS TECHNICAL INSTITUTE$],[$Unadjusted Trial Balance$],[$December $31]]],[,$Debit,Credit$],[$Cash$,$$$26,944,],[$Accounts receivable,$0,],[$Teaching supplies,$10,362,],[$Prepaid insurance,$15,545,],[$Prepaid rent,$2,073,],[$Professional library,$31,088,],[$Accumulated depreciation$-$Professional library,,$$9,328],[$Equipment$,105,000,],[$Accumulated depreciation$-$Equipment,,$16,582],[$Accounts payable,,$24,000],[$Salaries payable,,$0],[$Unearned revenue,,$15,000],[$Common stock,,$24,077],[$Retained earnings,,$84,000],[$Dividends$,41,452,],[$Tuition revenue,,$105,701],[$Training revenue,,$39,379],[$Depreciation expense$-$Professional library,$0,],[$Depreciation expense$-$Equipment,$0,],[$Salaries expense,$49,743,],[$Insurance expense,$0,],[$Rent expense,$22,803,],[$Teaching supplies expense,$0,],[$Advertising expense,$7,254,],[$Utilities expense,$5,803,],[$Totals$,$$$318,067,$$$318,067]]$ WELLS TECHNICAL INSTITUTE

Income Statement

For Year Ended December $31$ Prepare Wells Technical Institute's statement of retained earnings $f$

$$84,000$ on December $31$ of the prior year.WELLS TECHNICAL INSTITUTE

Balance Sheet

December $31$