Blue Spruce Corp's unadjusted trial balance at December 1, 2017 is presented below. Credit Debit $25,300 36,400 8.900 0 36,390 3,300 20,600 143,400 60,000 10,350 $450 47,800 24,000 27,600 0 12,000 0 Cash Accounts Receivable Notes Receivable Interest Receivable Inventory Prepaid Insurance Land Buildings Equipment Patent Allowance for Doubtful Accounts Accumulated Depreciation-Buildings Accumulated Depreciation-Equipment Accounts Payable Salaries and Wages Payable Notes Payable (due April 30, 2018) Income Taxes Payable Interest Payable Notes Payable (due in 2023) Common Stock Retained Earnings Dividends Sales Revenue Interest Revenue Gain on Disposal of Plant Assets Bad Debt Expense Cost of Goods Sold Depreciation Expense Income Tax Expense Insurance Expense Interest Expense Other Operating Expenses Amortization Expense Salaries and Wages Expense Total 0 35,100 59,900 19,390 13,500 929,000 0 0 0 632,500 0 0 0 0 61,600 0 103,000 $1,155,240 $1,155,240 The following transactions occurred during December. Dec. 2 Purchased equipment for $17,400, plus sales taxes of $600 (paid in cash). 2 Blue sold for $3,500 equipment which originally cost $5,400. Accumulated depreciation on this equipment at January 1, 2017, was $1,900; 2017 depreciation prior to the sale of equipment was $480. Blue sold for $5,400 on account inventory that cost $3,450. Salaries and wages of $6,360 were paid. 15 23 Adjustment data: 1. 2. 3. 4. 5. 6. Blue estimates that uncollectible accounts receivable at year-end are $3,810. The note receivable is a one-year, 8% note dated April 1, 2017. No interest has been recorded. The balance in prepaid insurance represents payment of a $3,300, 6-month premium on September 1, 2017. The building is being depreciated using the straight-line method over 30 years. The salvage value is $30,300. The equipment owned prior to this year is being depreciated using the straight-line method over 5 years. The salvage value is 10% of cost. The equipment purchased on December 2, 2017, is being depreciated using the straight-line method over 5 years, with a salvage value of $1,800. The patent was acquired on January 1, 2017, and has a useful life of 9 years from that date. Unpaid salaries at December 31, 2017, total $2,090. Both the short-term and long-term notes payable are dated January 1, 2017, and carry a 10% interest rate. All interest is payable in the next 12 months. Income tax expense was $13,300. It was unpaid at December 31. 7. 8. 9. 10 Part 1 Prepare journal entries for the transactions listed above and adjustingentriz. (Cedit account bites are automatically indented when amounts arred. Do not indentmarely no entry is required, sest No Entry for the account title and enter for the armounts Record journal entries in the order presented in the problem Date Account Titles and Explanation Debit Credit (To record depreciation expense on equipment) To record sale of equipment