Question
Unadjusted trial balance Dialog content starts Hudson Bay Research Unadjusted Trial Balance April 30, 2020 Balance Account Title Debit Credit Cash $38,000 Accounts receivable 40,000
Unadjusted trial balance
Dialog content starts
Hudson Bay Research | ||||
Unadjusted Trial Balance | ||||
April 30, 2020 | ||||
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| Balance |
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| Account Title | Debit | Credit |
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| Cash | $38,000 |
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| Accounts receivable | 40,000 |
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| Prepaid rent | 18,000 |
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| Supplies | 3,800 |
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| Furniture | 78,000 |
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| Accumulated amortizationfurniture |
| $13,800 |
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| Accounts payable |
| 20,000 |
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| Salaries payable |
| 0 |
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| J. Shaw, capital |
| 179,800 |
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| J. Shaw, withdrawals | 48,000 |
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| Consulting revenue |
| 127,000 |
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| Salaries expense | 44,000 |
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| Rent expense | 37,000 |
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| Utilities expense | 26,000 |
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| Amortization expensefurniture | 7,800 |
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| Supplies expense | 0 |
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| Total | $340,600 | $340,600 |
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Accrued consulting revenue at April 30, $4,000. | |
b. | The prepaid balance of $18,000 represented one year of rent. Four months of prepaid rent have been used. |
c. | Supplies remaining on hand at April 30, $980. |
d. | The estimated useful life of the furniture is 10 years; it will have no value at the end of 10 years, and the straight-line method of amortization is used. Amortization expense had only been taken for the first 11 months. |
e. | Accrued salaries expense at April 30 is for three days. The five-day weekly payroll is$7,000. |
Requirement 1. Prepare the adjusted trial balance of
Hudson Bay
Research at
April
30,
2020
by sketching T-accounts in your notes to calculate the new balances.
Complete the adjusted trial balance. Remember to consider the adjustments provided in the problem. (Round all adjustments to the nearest whole dollar. If a box is not used in the adjusted trial balance, leave the box empty; do not enter a zero.)
| Hudson Bay Research |
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| Adjusted Trial Balance |
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| April 30, 2020 |
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| Balance |
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| Account Title | Debit | Credit |
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| Cash |
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| Accounts receivable |
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| Prepaid rent |
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| Supplies |
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| Furniture |
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| Accumulated amortizationfurniture |
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| Accounts payable |
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| Salaries payable |
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| J. Shaw, capital |
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| J. Shaw, withdrawals |
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| Consulting revenue |
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| Salaries expense |
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| Rent expense |
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| Utilities expense |
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| Amortization expensefurniture |
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| Supplies expense |
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| Total |
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Requirement 2. Prepare the income statement and the statement of owner's equity for the year ended
April
30,
2020,
and the balance sheet at
April
30,
2020.
Write a short description of how the three financial statements are linked.
Begin with the income statement.
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| Expenses: |
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| Total expenses |
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| Net income |
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Next, prepare the statement of owner's equity.
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Finally, prepare the balance sheet. Begin with the heading, and then complete the body of the statement.
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| Total liabilities |
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| Owner's Equity |
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| Total assets |
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| Total liabilities and owner's equity |
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Write a short description of how the three financial statements are linked.
Expenses
Net income (or net loss)
Revenue
from the income statement is transferred to the
balance sheet.
statement of owner's equity.
trial balance.
The ending balance of
capital
expenses
revenues
withdrawals
is then transferred to the owner's equity section of the balance sheet.
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