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USE THE FOLLOWING INFORMATION TO ANSWER THE NEXT (5) QUESTIONS: Magic Cleaning Services has a fiscal year end of December 31st. It is in its
USE THE FOLLOWING INFORMATION TO ANSWER THE NEXT (5) QUESTIONS: Magic Cleaning Services has a fiscal year end of December 31st. It is in its first year of operations. As of December 31, Magic has the following unadjusted trial balance: Account Cash Accounts Receivable Debit $430,900 $158,000 $111,000 $90,000 Credit Supplies Building Accounts Payable Unearned Service Revenue Common Stock $ 45,900 $108,000 $100,000 -0 $619,200 Retained Earnings Service Revenue Wage Expense Rent Expense Utilities Expense Administrative Expense $ 48,600 $12,400 $ 6,200 $ 16,000 $873,100 TOTALS $873,100 In addition, Magic has not yet adjusted for the following: I. The building was purchased on March 1 of the current year. It has a 30-year life, 10% salvage value and Magic uses the straight-line method for depreciation. 2. On September 1, Magic prepaid $12,400 for 10 months of rent on a warehouse. The original entry was recorded as Rent Expense. 3. By December 31st, 30% of the of the services related to the Unearned Revenues had been performed 4. Wages of $4,600 should be accrued and are scheduled to be paid on lanuary2
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