Unadjusted Trial Balance For the year ended 31st Dec 2014 Credit Debit Cash 40,000 60,000 Accounts Receivab le Allowance for Doubtful Accounts Inventory Prepaid Insurance Equipment Accumulated Depreciation-Equipment Notes Payable Interest Payable Salaries & Wages Payable Owner's Capital Retained earnings Service Revenue Unearned service revenue 5,000 30,000 10,000 150,000 50,000 15,000 50,000 60,000 230,000 20,000 Cost of Goods Sold 100,000 30,000 Selling Expenses Interest Expense Admin Expenses 15,000 Interest revenues 10,000 Loss on sale of fixed assets 5,000 Total 440,000 440,000 $10,000 recorded as unearned service revenue was earned during the year Services performed for clients that were not recorded by December 31, $5,000 Prepaid Insurance expired during the year $3,000. (Admin Expense) Equipment is being depreciated at 20% per year. (C0GS expense) Office salaries and wages earned but unpaid December 31, 2014, $5,000. (Admin Expense) A physical count shows that $15,000 worth of inventory is left The note payable is a long term note with an interest rate of 20%. Interest is payable annually on Jan 1 st 1. 2. 3. 4. 5. 6. 7. Required: Prepare journal entries to record transactions in notes 1 - 7. Prepare an adjusted trial balance Prepare an Income Statement, Statement of Stockholders Equity and a Balance Sheet in good form You may use theformats provided below and in the adjacent tabs BALANCE SHEET Current Assets Cash A/R less Allowance for DD Inventory Prep Ins Total CA Long term Assets Equipment less Accum Dep Total Assets Short term liabilities Interest Payable Wages Payable Notes Payable Unearned Service Rev Dividends payable Inc Tax Payable Total Liabilities Shareholders eq Capital RE Total Shareholders Eq TOTAL LIABILITIES+SHAREHOLDERS EQUITY ABC Company Income Statement For the Year ended 12/31/2014 Revenue Sales Revenue (Less Sales Returns and Allowances) Net Sales Cost of Goods Sold COGS Gross Profit (Loss) Net Sales-COGS Expenses Admin Expense Selling Expense Total Net operating income Other Income Interest Revenues Interest Exp Loss of Fixed Asset Total Income before taxes Taxes 30% Net Income Statement of Retained Earnings Capital Invested Beginning Retained Earnings Add Net Income Minus Dividends Declared Ending Retained Earnings Ending Stockholders Equity