Shayla Green owns Creative Designs. The trial balance of the firm for January 31, 20X1, the first month of operations, is shown below. End-of-the-month adjustments must account for the following items: a. Supplies were purchased on January 1, 20x1; inventory of supplies on January 31, 20x1, is $3,200. b. The prepaid advertising contract was signed on January 1, 20x1, and covers a four-month period. c. Rent of $4.200 expired during the month. d. Depreciation is computed using the straight-line method. The equipment has an estimated useful life of 10 years with no salvage value. Required: 1. Complete the worksheet for the month. 2. Prepare an income statement, statement of owner's equity, and balance sheet. No additional investments were made by the owner during the month 3. Journalize and post the adjusting entries. Analyze: If the adjusting entries had not been made for the month, by what amount would net income be overstated or understated? Complete this question by entering your answers in the tabs below. Reg1 Reg 2 Inc Stunt Reg 2 Stmt of OF Reg 2 Bal Sheet Req3 Gen Journal Reg 3 Ledgers Analyze Prepare an income statement. CREATIVE DESIONAL Complete this question by entering your answers in the tabs below. Reqi Req 2 Inc Stmt Req 2 Stmt of OE Req 2 Bal Sheet Req 3 Gen Journal Req 3 Ledgers Analyze Prepare an income statement. CREATIVE DESIGNS Income Statement Month Ended January 31, 20X1 Revenue Expenses 0 Total expenses $ 0 Complete this question by entering your answers in the tabs below. Req 2 Inc Stmt Analyze Reg 2 Stmt of OE Reg 2 Bal Sheet Reg 3 Gen Journal Reg 3 Ledgers Reg 1 Prepare a statement of owner's equity. No additional investments were made by the owner during the month. CREATIVE DESIGNS Statement of Owner's Equity Month Ended January 31, 20X1 0 $ 0 Reg 2 Inc Stmt Req 1 Req 2 Stmt of OE Reg 2 Bal Reg 3 Gen Journal Reg 3 Ledgers Analyze Sheet Prepare a balance sheet. CREATIVE DESIGNS Balance Sheet January 31, 20X1 Assets 0 $ 0 Total assets Liabilities and Owner's Equity Liabilities Owner's Equity Total Liabilities and Owner's Equity $ Income Sta Debit Account Name Trial Balance Debit Credit 73,000 27 200 19 500 24 BOO 50,400 67,200 5601 Worksheet Month Ended January 31, 20x1 Adjustments Adjusted Trial Balance Debit Credit Debit Credit $ 73,000 27,200 16.300 3.200 6.200 18.600 4.200 45.200 67.2001 560 33,100 122.000 16.000 148,200 6.200 6.200 560 560 4,200 4,200 21.400 16,300 16,300 3.800 27.2605 27.2005 303,860 $ 303,860 $ 33,100 1.22.000 Cash Accounts receivable Supplies Prepaid advertising Prepaid rent Equipment Accumulated depreciation Equipment Accounts payable Shayla Green Capital Shayla Green, Drawing Fees income Advertising expense Depreciation expense Equipment Rent expense Salaries expense Supplies expense Utilities expense Subtotais het income Totals 16,000 148.200 21,400 6.200 560 4.200 21.400 16 300 3.800 52.460 95,740 140 200 3.800 303,300 $ 303,300 $ $ $ CREATIVE ULSIONS Income Statement Debit Credit $ Worksheet Month Ended January 31, 20X1 Adjustments Adjusted Trial Balance Debit Credit Debit Credit $ 73,000 27,200 16,300 3,200 6,200 18,600 4,200 46,200 67,200 560 560 33,100 122,000 16,000 148,200 6,200 560 560 4,200 4,200 21,400 16,300 16,300 3,800 27,260 $ 27,260 $ 303,860 $ 303,860 $ Balance Sheet Debit Credit 73,000 27,200 3,200 18,600 46,200 67,200 560 33,100 201,740 148,200 +.200 6,200 560 4,200 21.400 16,300 3,800 52,460 $ 95,740 148,200 $ 148,200 $ 235,400 $ 235,400 $ 148.200 $ 235,400 $ 235,400