Stackhouse, Connelly, and Teagarden Enterprises (SCT Enterprises) was formed in December 2014. During the first month of operation, the following transactions occurred:

Dec 1 - Issued common stock in exchange for $1,000,000 cash.

Dec 2 - Purchased inventory on account for $80,000 (the perpetual inventory system is used).

Dec 3 - Purchased $500,000 in equipment for cash.

Dec 4 - Paid the companys landlord $12,000 for rent for twelve months, debiting Prepaid Rent Expense.

Dec 10 - Sold merchandise on account for $130,000. The cost of the merchandise was $75,000.

Dec 15 - Borrowed $60,000 from a local bank and signed a note. Principal and interest of 10% to be repaid in one year.

Dec 20 - Paid employees $20,000 wages for the first half of the month.

Dec 24 - Paid $60,000 to suppliers for the merchandise purchased on December 2.

Dec 26 - Collected $50,000 on account from customers.

Dec 28 - Paid various utility bills of $3,500 for the month of December.

Dec 31 - Paid $8,000 in insurance for the period January 1,2015 to March 1, 2015.

Dec 31 - Received payment of $5,000 for an order to be delivered January 20. The cost of the merchandise for the order will be $3,500.

Required (round all computations to the nearest whole dollar):

1. Prepare journal entries to record the above transactions and post these entries to their corresponding T-accounts (ledger).

2.Prepare an unadjusted trial balance.

3.Prepare adjusting entries for December, considering:

a.Depreciation on the equipment is $42,000 per year.

b. Rent expense for the month.

c. Interest expense for the month.

d. Wages for the second half of the month; assume employees earned wages evenly

throughout the month.

4. Prepare an adjusted trial balance.

5. Prepare a basic income statement, a statement of stockholders equity, and a balance sheet

for the year ending December 31, 2014.

6. Prepare closing entries.

7. Prepare a post-closing trial balance.