The trial balance of Pacilio Security Services, Inc. as of January 1, Year 3, had the following normal balances: Cash Accounts Receivable Supplies Prepaid Rent Land Accounts Payable Unearned Revenue Salaries Payable Notes Payable Common Stock Retained Earnings $ 8,900 1,500 65 800 4,000 1,050 200 1,200 2,000 8,000 2,815 During Year 3, Pacilio Security Services experienced the following transactions: 1. Paid the salaries payable from Year 2. 2. Paid the balance of $2,000 on the debt owed to the Small Business Government Agency. The loan is interest-free. 3. Performed $32,000 of security services for numerous local events during the year; $21,000 was on account and $11,000 was for cash. 4. On May 1, paid $3,000 for 12 months' rent in advance. 5. Purchased supplies on account for $700. 6. Paid salaries expense for the year of $9,000. 7. Incurred other operating expenses on account, $4,200. 8. On October 1, Year 3, a customer paid $1,200 for services to be provided over the next 12 months. 9. Collected $19,000 of accounts receivable during the year. 10. Paid $5,950 on accounts payable. 11. Paid $1,800 of advertising expenses for the year. 12. Paid a cash dividend to the shareholders of $4,650. 13. The market value of the land was determined to be $5,500 at December 31, Year 3. Adjustments 14. There was $120 of supplies on hand at the end of the year. 15. The prepaid rent at the beginning of the year expired on May 1 of this year. Recognized the expired rent for the total year. 16. Recognized the earned revenue from Year 2 and transaction no. 8. 17. Accrued salaries were $1,000 at December 31, Year 3. Pacilio Security Services, Inc. Accounting Equation Assets = Accounts Receivable 1,500 Event Beginning balance Cash 8,900 Supplies 65 + Prepaid Rent 800 Accounts Payable 1,050 Land 4 Unearned Revenue 200 Liabilities Salaries Payable Notes Payable 1,200 2,000 Stockholders' Equity Common Retained Stock Earnings Acct. Title/RE 8,000 2,815 00 Subtotals 8,900 1,500 65 300 400 1,050 200 1,200 2,000 8,000 2,815 Totals 11,665 15.265 Accounting equation proof: