The unadjusted trial balance of Epicenter Laundry at June 30, 2018, the end of the fiscal year, follows: Epicenter Laundry UNADJUSTED TRIAL BALANCE June 30, 2018 ACCOUNT TITLE DEBIT CREDIT 1 Cash 11,000.00 2 Laundry Supplies 21,500.00 3 Prepaid Insurance 9,600.00 4 Laundry Equipment 232,600.00 5 Accumulated Depreciation 125,400.00 6 Accounts Payable 11,800.00 7 Common Stock 40,000.00 8 Retained Earnings 65,600.00 9 Dividends 10,000.00 9 Dividends 10,000.00 10 Laundry Revenue 232,200.00 11 Wages Expense 125,200.00 12 Rent Expense 40,000.00 13 Utilities Expense 19,700.00 14 Miscellaneous Expense 5,400.00 15 Totals 475,000.00 475,000.00 The data needed to determine year-end adjustments are as follows: A. Laundry supplies on hand at June 30 are $3,600. B. Insurance premiums expired during the year are $5,700. C. Depreciation of laundry equipment during the year is $6,500. D. Wages accrued but not paid at June 30 are $1,100. Required: Note: Download the spreadsheet on the T Accounts panel, saving the Excel file to your computer. Be sure to save your work in Required: Note: Download the spreadsheet on the T Accounts panel, saving the Excel file to your computer. Be sure to save your work in Excel. The spreadsheet input will not be included in your grade in CengageNOW on this problem. 1. For each account listed in the unadjusted trial balance, enter the balance in a T account. Identify the balance as Bal. 2. Using the Excel spreadsheet downloaded from the T Accounts panel, click the Work Sheet tab. Enter the unadjusted trial balance on the end-of-period work sheet and complete the work sheet. 3. a. Journalize the adjusting entries on page 10 of the journal. Adjusting entries are recorded on June 30. Refer to the Chart of Accounts for exact wording of account titles. 3. b. Post the adjusting entries. In the T accounts, identify the adjustments by Adj." and the new balances as Adj. Bal. (Be sure to add a posting reference to the journal.) 4. Prepare an adjusted trial balance. 5. a. Prepare an income statement for the year ended June 30, 2018. If a net loss has been incurred, enter that amount as a negative number using a minus sign. Be sure to complete the statement heading. You will not need to enter colons (:) on the income statement. Refer to the Chart of Accounts for exact wording of account titles. Refer to the lists of Labels and Amount Descriptions for exact wording of the answer choices for text entries other than account names. 5. b. Prepare a retained earnings statement for the year ended June 30, 2018. If a net loss is incurred or dividends were paid, enter that amount as a negative number using a minus sign. Be sure to complete the statement heading. Refer to the Chart of Accounts for exact wording of account titles. Refer to the lists of Labels and Amount Descriptions for exact wording of the answer choices for text entries other than account names. 5. b. Prepare a retained earnings statement for the year ended June 30, 2018. If a net loss is incurred or dividends were paid, enter that amount as a negative number using a minus sign. Be sure to complete the statement heading. Refer to the Chart of Accounts for exact wording of account titles. Refer to the lists of Labels and Amount Descriptions for exact wording of the answer choices for text entries other than account names. 5. c. Prepare a balance sheet as of June 30, 2018. Fixed assets must be entered in order according to account number. Be sure to complete the statement heading. You will not need to enter colons (:) on the balance sheet; they will automatically insert where necessary. Refer to the Chart of Accounts for exact wording of account titles. Refer to the lists of Labels and Amount Descriptions for exact wording of the answer choices for text entries other than account names. For those boxes in which you must enter subtracted or negative numbers use a minus sign. 6. a. Journalize the closing entries on page 11 of the journal. Refer to the Chart of Accounts for exact wording of account titles. (Note: Complete the adjusted trial balance, the income statement, the retained earnings statement, and the balance sheet BEFORE completing part 6. a.) 6. b. Post the closing entries. In the Taccounts, identify the closing entries by "Clos." (Be sure to add a posting reference to the journal.) 7. Prepare a post-closing trial balance. Epicenter Laundry General Ledger ASSETS REVENUE 11 Cash 41 Laundry Revenue 13 Laundry Supplies 14 Prepaid Insurance EXPENSES 17 Laundry Equipment 51 Wages Expense 18 Accumulated Depreciation 52 Rent Expense 53 Utilities Expense LIABILITIES 54 Laundry Supplies Expense 21 Accounts Payable 55 Depreciation Expense 22 Wages Payable 56 Insurance Expense 59 Miscellaneous Expense EQUITY 31 Common Stock 32 Retained Earnings 33 Dividends 34 Income Summary Labels Current assets Current liabilities Expenses For the Year Ended June 30, 2018 June 30, 2018 Property, plant, and equipment Amount Descriptions Change in retained earnings Net income Net loss Retained earnings, June 30, 2018 Retained earnings, July 1, 2017 Total assets Total current assets Total expenses Total liabilities Total liabilities and stockholders' equity Total property, plant, and equipment Total stockholders' equity T Accounts Note: Download the SPREADSHEET, saving the Excel file to your computer. Be sure to save your work in Excel. The spreadsheet input will not be included in your grade in CengageNOW on this problem. 1. For each account listed in the unadjusted trial balance, enter the balance in a T account. Identify the balance as Bal. 3. b. Post the adjusting entries. In the Taccounts, identify the adjustments by "Adj." and the new balances as "Adj. Bal." 6. b. Post the closing entries. In the T accounts, identify the adjustments by Clos. Work Sheet 2. Using the Excel spreadsheet downloaded from the T Accounts panel, click the Work Sheet tab. Enter the unadjusted trial balance on the end-of-period work sheet and complete the work sheet. Feedback Check My Work 2. Enter each account balance shown and extend the balances to the appropriate debit or credit columns in the unadjusted trial balance. Double-check to make sure that the totals of the debit and credit columns are equal. For the adjustments, enter them in the order in which the data are assembled (a-d). If the titles of the accounts to be adjusted do not appear in the unadjusted trial balance, add the accounts in their proper order in the Account Title column. As you complete the work sheet, remember that adjustments affect both an income statement account and a balance sheet account. Also total debit adjustments must equal the total credit adjustments. In addition, the adjusted trial balance debit and credit column totals must remain equal. The adjusted trial balance is entered by combining the adjustments with the unadjusted balances for each account. To calculate the new adjusted trial balance amounts, remember you add a beginning debit(credit) unadjusted amount to a debit(credit) adjustment to obtain the adjusted amount. However, if the unadjusted trial balance amount is a debit and the adjustment is a credit, you will subtract to obtain the adjusted amount. Likewise you will take the difference between a credit unadjusted amount and a debit adjustment to obtain the adjusted amount. From the adjusted trial balance, extend the amounts into their respective income statement and balance sheet columns. Determine the difference between the two Income statement column totals which is the amount of the net income or the net loss for the period. This difference (net income or net loss) will also be the difference between the two Balance Sheet column totals. 3. a. Journalize the adjusting entries on page 10 of the journal. Adjusting entries are recorded on June 30. Refer to the Chart of Accounts for exact wording of account titles. 6. a. Journalize the closing entries on page 11 of the journal. Refer to the Chart of Accounts for exact wording of account titles. (Note: Complete the adjusted trial balance, the income statement, the retained earnings statement, and the balance sheet BEFORE completing part 6. a.) All transactions on this page must be entered (except for post ref(s)) before you will receive Check My Work feedback. PAGE 10 PAGE 11 JOURNAL Score: 143/303 ACCOUNTING EQUATION DATE DESCRIPTION POST. REF. DEBIT CREDIT ASSETS LIABILITIES EQUITY 1 Adjusting Entries 2 Cash 11 11,000.00 t 3 Laundry Supplies 13 21,500.00 17,900.00 4 Prepaid Insurance 14 9,600.00 5,700.00 5 5 Laundry Equipment 17 232,600.00 1 6 Accumulated Depreciation 18 125,400.00 1 7 Accounts Payable 21 11,800.00 + 8 Common Stock 31 40,000.00 + 9 Retained Earnings 32 65,600.00 + Points: 34.92/74 a. Journalize the closing entries on page 11 of the journal. Refer to the Chart of Accounts for exact wording of account titles. (Note: Complete the adjusted trial balance, the inco statement, the retained earnings statement, and the balance sheet BEFORE completing part 6. a.) All transactions on this page must be entered (except for post ref(s)) before you will receive Check My Work feedback. PAGE 10 PAGE 11 JOURNAL Score: 143/303 ACCOUNTING EQUATION DATE POST. REF. DEBIT CREDIT ASSETS LIABILITIES EQUITY DESCRIPTION Closing Entries 1 2 Dividends 33 10,000.00 3 Laundry Revenue 41 232,200.00 1 4 Wages Expense 51 125,200.00 1 5 52 40,000.00 1 6 53 19,700.00 1 Rent Expense Utilities Expense Miscellaneous Expense Supplies Expense 7 59 5,400.00 8 17,900.00 9 Insurance Expense 56 5,700.00 + 10 Depreciation Expense 55 6,500.00 + 11 Wages Payable 22 1,100.00 1 12 8 Supplies Expense 17,900.00 9 Insurance Expense 56 5,700.00 1 10 Depreciation Expense 55 6,500.00 1 11 Wages Payable 22 1,100.00 1 12 13 14 15 Points: 34.92 / 74 5. a. Prepare an income statement for the year ended June 30, 2018. If a net loss has been incurred, enter that amount as a negative number using a minus sign. Be sure to complete the statement heading. You will not need to enter colons (:) on the income statement. Refer to the Chart of Accounts for exact wording of account titles. Refer to the lists of Labels and Amount Descriptions for exact wording of the answer choices for text entries other than account names. Epicenter Laundry Score: 84/98 Income Statement (Label) 1 Laundry revenue $232,200.00 2 Expenses: 3 Wages expense $126,300.00 4 Rent expense 40,000.00 5 Utilities expense 19,700.00 6 Miscellaneous expense 5,400.00 7 Supplies expense 17,900.00 8 Insurance expense 5,700.00 9 Depreciation expense 6,500.00 10 Net Operating Income 221,500.00 5. b. Prepare a retained earnings statement for the year ended June 30, 2018. If a net loss is incurred or dividends were paid, enter that amount as a negative number using a minus sign. Be sure to complete the statement heading. Refer to the Chart of Accounts for exact wording of account titles. Refer to the lists of Labels and Amount Descriptions for exact wording of the answer choices for text entries other than account names. Epicenter Laundry Score: 3/52 Retained Earnings Statement (Label) 1 Ending Balance $66,300.00 2 Balances $65,600.00 3 Net Operating Income 10,700.00 4 Sub-Total 76,300.00 5 Dividends $10,000.00 Points: 0.63 / 11 Feedback 5. c. Prepare a balance sheet as of June 30, 2018. Fixed assets must be entered in order according to account number. Be sure to complete the statement heading. You will not need to enter colons (-) on the balance sheet; they will automatically insert where necessary. Refer to the Chart of Accounts for exact wording of account titles. Refer to the lists of Labels and Amount Descriptions for exact wording of the answer choices for text entries other than account names. For those boxes in which you must enter subtracted or negative numbers use a minus sign. Epicenter Laundry Score: 113/135 Balance Sheet (Label) 1 Assets 2 Current assets: 3 Cash $11,000.00 3,600.00 4 Laundry supplies 5 Prepaid insurance 3,900.00 6 $18,500.00 6 $18,500.00 1 Tangible Assets: 8 Laundry equipment $232,600.00 9 Accumulated depreciation 125,400.00 10 11 Total assets $232,600.00 12 Liabilities 13 Current liabilities: 14 Accounts payable $11,800.00 15 Wages payable 1,100.00 16 Wages expense $12,900.00 17 Stockholders' Equity 18 Common stock $40,000.00 19 Retained earnings 66,300.00 20 Total stockholders' equity 106,300.00