The following unadjusted and adjusted trial balances are available for Interior Designs, Inc., as of andfor the fiscal year ended December 31, 20X7.

Unadjusted Trial Balance

Adjusted TrialBalance

	Debit		Credit		Debit		Credit
Cash	$20,000				$20,000
Accounts receivable	11,000				19,500
Prepaid insurance	4,400				4,000
Office supplies	7,000				6,000
Prepaid rent	6,000				5,500
Equipment	120,000				120,000
Accumulated depreciation			$22,000				$23,000
Interest payable			500				600
Accounts payable			13,500				13,500
Income tax payable			2,000				3,000
Salaries payable			0				3,000
Unearned professional fees revenue			15,000				14,000
Notes payable (due 20X9)			20,000				20,000
Common stock			40,000				40,000
Retained earnings			50,200				50,200
Dividends	9,000				9,000
Professional fees revenue			86,000				95,500
Interest expense	1,100				1,200
Salaries expense	25,000				28,000
Insurance expense	4,400				4,800
Rent expense	11,000				11,500
Depreciation expense	11,000				12,000
Income tax expense	5,600				6,600
Supplies expense	6,000				7,000
Utilities expense	7,700				7,700
Totals	$249,200		$249,200		$262,800		$262,800

a) Prepare the adjusting entries that must have been made.

b) Prepare the income statement and the statement of retained earnings for the fiscal yearended December 31, 20X7, as well as a statement of financial position as of December 31,20X7.

c) Prepare closing entries.

d) Prepare a retained earnings general ledger T account showing the January 1, 20X7, balance,the effect of the closing entries, and the December 31, 20X7, balance.

The following unadjusted and adjusted trial balances are available for Interior Designs, Inc., as of andfor the fiscal year ended December 31, 20X7.

Unadjusted Trial Balance

Adjusted TrialBalance

	Debit		Credit		Debit		Credit
Cash	$20,000				$20,000
Accounts receivable	11,000				19,500
Prepaid insurance	4,400				4,000
Office supplies	7,000				6,000
Prepaid rent	6,000				5,500
Equipment	120,000				120,000
Accumulated depreciation			$22,000				$23,000
Interest payable			500				600
Accounts payable			13,500				13,500
Income tax payable			2,000				3,000
Salaries payable			0				3,000
Unearned professional fees revenue			15,000				14,000
Notes payable (due 20X9)			20,000				20,000
Common stock			40,000				40,000
Retained earnings			50,200				50,200
Dividends	9,000				9,000
Professional fees revenue			86,000				95,500
Interest expense	1,100				1,200
Salaries expense	25,000				28,000
Insurance expense	4,400				4,800
Rent expense	11,000				11,500
Depreciation expense	11,000				12,000
Income tax expense	5,600				6,600
Supplies expense	6,000				7,000
Utilities expense	7,700				7,700
Totals	$249,200		$249,200		$262,800		$262,800

a) Prepare the adjusting entries that must have been made.

b) Prepare the income statement and the statement of retained earnings for the fiscal yearended December 31, 20X7, as well as a statement of financial position as of December 31,20X7.

c) Prepare closing entries.

d) Prepare a retained earnings general ledger T account showing the January 1, 20X7, balance,the effect of the closing entries, and the December 31, 20X7, balance.