Review Problem David Advertising Trial Balance December 31, 2014
Account Title	Dr.		Cr.
Cash		$7,600
AccountsReceivable		7,200
Supplies		4,700
PrepaidInsurance		3,600
Prepaid Rent		2,400
Equipment		24,000
Accumulateddepreciation-Equipment				$6,500
Accounts Payable				4,400
Notes Payable				9,000
Unearned Revenue				3,600
Share Capital				20,000
Retained Earnings				-0-
Dividends		2,500
Service Revenue				14,000
Salaries Expense		5,200
Utilities Expense		300
$57,500		$57,500		$57,500

Adjustment (1) data:

1.The remaining supplies at December 31 are $2,000.

2.The insurance policy was purchased on December 1 for one year.

3.The expired rent for the month is $200.

4.The equipment is depreciated at the rate of $1,500 per month.

5.The notes payable represent a 3-month 10% note that was signed on December 1.

6.$2,600 of the unearned service revenue has been earned at the end of December.

7.Salaries of $2,000 are accrued at December 31.

8.Invoices representing $2,000 of services performed during December have not been recorded as of December 31.

Instructions:

1.Journalize the adjusting entries for David Advertising at December 31.

2.If the adjustment were not made. Indicate the effect on net income, assets and liabilities. (Overstated, understated or N/A)

3.Post the adjusting entries.

4.Prepare an adjusted trial balance.

Required 1. Prepare the adjustment MUST be in a General Journal

Required 2. Must be a table like the solved example.