Use of a Trial Balance as a basis for Adjusting Entries Bob Reynolds operates a real estate business. A trial balance on April 30, 2016, before any adjusting entries are recorded, appears as follows: Credit Reynolds Realty Company Unadjusted Trial Balance April 30, 2016 Debit Cash $15,700 Prepaid Insurance 450 Office Supplies 250 Office Equipment 50,000 Accumulated Depreciation-Office Equipment Automobile 12,000 Accumulated Depreciation-Auto Accounts Payable Deferred Commissions $5,000 1,400 6,500 9,500 2,000 10,000 Notes Payable Capital Stock 40,000 Retained Earnings Dividends 2,500 Commissions Revenue 17,650 2,300 Utilities Expense Salaries Expense Advertising Expense 7,400 1,450 Totals $92,050 $92,050 Other Data a. The monthly insurance cost is $50. b. Office supplies on hand on April 30, 2016, amount to $180. c. The office equipment was purchased on April 1, 2015. On that date, it had an estimated useful life of ten years. d. On September 1, 2015, the automobile was purchased; it had an estimated useful life of five years. e. A deposit is received in advance of providing any services for first-time customers. Amounts received in advance are recorded initially in the account Deferred Commissions. Based on services provided to these first-time customers, the balance in this account at the end of April should be $5,000. 1. Repeat customers are allowed to pay for services one month after the date of the sale of their property. Services rendered during the month but not yet collected or billed to these customers amount to $1,500. g. Interest owed on the note payable but not yet paid amounts to $20. h. Salaries owed but unpaid to employees at the end of the month amount to $2,500. 1. Prepare the necessary adjusting entries at April 30, 2016. Entries (a) through (h) correspond to the Other Data. How does this entry affect the accounting equation? Indicate the effect on financial statement items by selecting "-" for decrease (or negative effect), '+' for increase (or positive effect) and "NE" for No Entry (or no effect) on the financial statement. Do not round intermediate calculati required, round your final answers to the nearest dollar a. To recognize one month's insurance expense. Journal Balance Sheet Income Statement Stockholders Net Description Debit Credit Assets Liabilities + Equity Revenues Expenses Income b. To record supplies used. Journal Balance Sheet Income Statement Net Stockholders' Equity Description Debit Credit Assets Liabilities + Revenues Expenses Income C. To record depreciation. Journal Balance Sheet Income Statement Stockholders Net Description Debit Credit Assets Liabilities Equity Revenues Expenses Income d. To record depreciation Journal Balance Sheet Income Statement Net Stockholders' Equity Description Debit Credit Assets Liabilities Revenues Expenses Income e. Ta record commissions revenue. Journal Balance Sheet Income Statement Stockholders' Net Description Debit Credit Assets Liabilities Equity Revenues Expenses Income f. To record revenue not yet collected. Journal Balance Sheet Income Statement Stockholders' Net Description Debit Credit Assets Liabilities Equity Revenues Expenses Income g. To record interest on note payable Journal Balance Sheet Income Statement Stockholders' Net Description Debit Credit Assets Liabilities Equity Revenues Expenses Income h. To record salaries not yet pald. Journal Balance Sheet Income Statement Stockholders' Net Description Debit Credit Assets Liabilities Equity Revenues Expenses Income 2. An equipment is purchased for $50,000 on April 1, 2015. The unadjusted trial balance reports a credit balance in Accumulated Depreciation - Office Equipment of $5,000. Which of the following statement is incorrect in information above