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Samara Inc. provides you with the following inforrnation for the year ended June 30 , 209. The bookkeeper is new and has come from a
Samara Inc. provides you with the following inforrnation for the year ended June 30 , 209. The bookkeeper is new and has come from a small company that used "cash accounting method to record all financial transactions. The company adjusts the accounts annually. However, the accountant has overlooked the following: - On June 30,20x9, a count of the supplies on hand revealed that only $210 worth of supplies were remaining. - Insurance premiums of $2,400 were paid on December 31,208 for a 12-month policy effective January 1,209. The prepaid insurance account was debited for the $2,400 at the time of payment. - The company leases part of its premises to a tenant. On April 1,20x9 the tenant 2010. - Samara Inc.'s Equipment is depreciated straight-line over a ten-year period. This equipment was purchased in September 207. - On January 1, 20x9, Samara inc. borrowed $75,000 from the blok. The terms of the loan were as follows: The loan is to be repaid July 1,2013 and interest is paid semiannually at a rate of 4% per year on the original principal. Required: a) Prepare the adjusting journal entries for Samara Inc, as at June 30,209. (15 marks) b) Prepare the Income Statement for Samara Inc. for the period ended June 30, 209. (12 marks) c) Prepare the classified Balance Sheet for Samara inc. as at June 30,209. (12 marks) d) Prepare the closing entries for Samara inc. as at June 30,209. (6 marks)
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