transactions that occurred in these months are described in Chapter 2.) Before proceeding in December, Gra 3. Prepare an adjusted trial balance as of December 31, 2020. 5. Prepare a balance sheet as of December 31, 2020, CHAPTER 3 Adjusting Accounts for Financial Statements After the success of its first two months, Mary Graham has decided to continue operating Echo Systems. The ham adds these new accounts to the chart of accounts for the ledger LA Acco Accumulated Depreciation of cement Accumulated Depreciation. Computer Equipment Wages Payable Uneamed Computer Services Revenue Depreciation Expense Office Equipment Depreciation Expense, Computer Equipment Insurance Expense Rent Expense Computer Supplies Expense 164 168 210 236 512 613 640 652 Required 1. Prepare journal entries to record each of the following transactions for Echo Systems. Post the entries to the accounts in the ledger. Dec 3 3 4 10 14 17 Paid $2,100 to the Lakeshore Mall for the company's share of mal advertising costs Paid $1.200 to repair the company's computer Received $7.500 from Alamo Engineering Co. for the receivable from the prior month Paid Carly Smith for six days' work at the rate of $200 per day Notified by Alamo Engineering Co. that Echo's bid of $12,000 on a proposed project was accepted. Alamo paid an advance of $3.000. Purchased $2,310 of computer supplies on credit from Abbott Office Products Sent a reminder to Fostek Co to pay the fee for services originally recorded on November 8. Completed a project for Eine Corporation and received $11.250 cash. Took the week off for the holidays. Received $5.700 from Fostek Co. on its receivable. Reimbursed Mary Graham's business automobile expenses of 600 kilometres at $1.00 per kilometre. Graham withdrew $3,600 cash from the business 18 20 24-28 31 31 31 2. Prepare adjusting entries to record the following additional information collected on December 31, 2020. Post the entries to the accounts in the ledger. a. The December 31 inventory of computer supplies was $1,440. b. Three months have passed since the annual insurance premium was paid. c. As of the end of the year, Carly Smith has not been paid for four days of work at the rate of $200 per day. d. The computer is expected to have a fouryear life with no residual value. c. The office equipment is expected to have a three-year life with no residual value. Prepaid rent for three of the four months has expired. Prepare an income statement and statement of changes in equity for the three months ended December 31, 2020 233