Use the scenario infromation provided and the information in the tables here to complete the rest of the tables.

Scenario for adjusting entries: Year end is December 31, 2017. Peyton Baking Company uses the following accounting practices: ? Inventory: Periodic, FIFO for both baking and merchandise o Baking supplies: $27,850 ending inventory ? Equipment: Straight line method used for equipment o Mixing machine: $5,000 initial cost, $500 salvage value, 3rd year of use of 7 total ($642.86 per year) o Ovens: $8,000 initial cost, $1,000 salvage value, 3rd year of use of 7 total ($1,000 per year) o Other depreciable equipment: $4,000 initial cost, $0 salvage value, 1st year of use of 4 total ($1,000 per year) o Bakery Leasehold Improvements: $10,000, 2nd year of use ($2,000 per year) o Trademark for company name: Initial cost, $2,300, 3rd year of use ? Office supplies: Periodic, FIFO. Ending balance is $250. ? Pay period is every 2 weeks. Last pay period ended December 27. o 60 employees with a daily pay of $5,700. All receive pay through December 31. ? Financing: o 6% interest note payable was made on January 31, 2017, and is due February 1, 2019. o 5-year loan was made on June 1, 2017. Terms are 7.5% annual rate, interest only until due date. ? Insurance: Annual policy covers 12 months, purchased in February, covering March 2017February 2018. No monthly adjustments have been made. Other information: An employee slipped and fell in the baking area and has filed a lawsuit. The company lawyer indicates that it is probable that the company will be found liable. No additional information is available.

Asset Accounts		Liability Accounts		Equity Accounts
	Acct #		Acct #		Acct #
Cash	101	Notes Payable	201	Common Stock	301
Baking Supplies	102	Accounts Payable	202	Dividends	302
Prepaid Rent	103	Wages Payable	203
Prepaid Insurance	104	Interest Payable	204
Baking Equipment	105	Loans Payable	205
Office Supplies	106
Accounts Receivable	107
Accumulated Depreciation	108
Trademark	109
Leasehold Improvements	110
Accumulated Amortization	111
				Revenue Accounts
This chart of accounts should help you identify the appropriate accounts to record to as you are analyzing and journaling transactions for this workbook. There is nothing to complete on this page; this is simply a resource for you.					Acct #
				Bakery Sales	401
				Merchandise Sales	402
				Expense Accounts
					Acct #
				Baking Cost of Goods Sold	501
				Merchandise Cost of Goods Sold	502
				Rent Expense	503
				Insurance Expense	504
				Misc. Expense	505
				Business License Expense	506
				Advertising Expense	507
				Wages Expense	508
				Telephone Expense	509
				Interest Expense	510
				Depreciation Expense	511
				Amortization Expense	512
				Office Supplies Expense	513

Peyton Approved
Adjusting Journal Entries
2017
Date	Accounts	Debit	Credit
31-Dec	Depreciation Expense
	Accumulated depreciation
31-Dec	Amortization Expense
	Accumulated Amortization
31-Dec	Interest Expense
	Interest Payable
31-Dec	Insurance Expense
	Prepaid Insurance
31-Dec	Baking Cost of Goods Sold
	Baking Supplies
31-Dec	Office Supplies Expense
	Office Supplies
31-Dec	Wages Expense
	Wages Payable
		-	-

Peyton Approved
Trial Balance
2017
	Unadjusted trial balance		Adjusting entries		Adjusted trial balance
Account	Debit	Credit	Debit	Credit	Debit	Credit
Cash	55,428.00				55,428.00
Baking Supplies	165,250.00				165,250.00
Merchandise Inventory (FIFO)	25,750.00				25,750.00
Prepaid Rent	7,500.00				7,500.00
Prepaid Insurance	2,400.00				2,400.00
Baking Equipment	26,000.00				26,000.00
Accumulated Depreciation		3,000.00				3,000.00
Leasehold Improvements	10,000.00				10,000.00
Accumulated Amortization		2,000.00				2,000.00
Trademark	2,300.00				2,300.00
Office Supplies	1,600.00				1,600.00
Accounts Receivable	30,401.00				30,401.00
Notes Payable		10,000.00				10,000.00
Interest Payable						-
Accounts Payable		27,325.00				27,325.00
Wages Payable						-
Loans Payable		21,000.00				21,000.00
Common Stock		30,000.00				30,000.00
Dividends	20,000.00				20,000.00
Bakery Sales		335,675.00				335,675.00
Merchandise Sales		35,200.00				35,200.00
Baking Cost of Goods Sold					-
Rent Expense	90,000.00				90,000.00
Interest Expense					-
Insurance Expense					-
Depreciation Expense					-
Amortization Expense					-
Misc. Expense	2,780.00				2,780.00
Office Supplies Expense					-
Business License Expense	375.00				375.00
Advertising Expense	5,200.00				5,200.00
Wages Expense					-
Telephone Expense	3,456.00				3,456.00
Merchandise COGS (FIFO)	15,760.00				15,760.00
Total: (FIFO)	464,200.00	464,200.00	-	-	464,200.00	464,200.00

Peyton Approved
Income Statement
For Year Ending 12/31/2017
	Bakery Sales		335,675.00
	Merchandise Sales		35,200.00
	Total Revenues		370,875.00
	Cost of Goods Sold (FIFO)
	Baking Cost of Goods Sold
	Gross Profit (FIFO)		370,875.00
	Operating Expenses:
	Rent Expense		90,000.00
	Interest Expense
	Insurance Expense
	Depreciation Expense
	Amortization Expense
	Misc. Expense		2,780.00
	Office Supplies Expense
	Business License Expense		375.00
	Advertising Expense		5,200.00
	Wages Expense
	Telephone Expense		3,456.00
	Total Operating Expenses:		101,811.00
	Net Income (FIFO)		269,064.00

Peyton Approved
Closing Entries
For Year Ending 12/31/2017
Date	Accounts	Debit	Credit
30-Sep	Bakery Sales
	Merchandise Sales
	Income Summary		-
30-Sep	Income Summary (FIFO)	-
	Baking Cost of Goods Sold
	Rent Expense
	Interest Expense
	Insurance Expense
	Depreciation Expense
	Amortization Expense
	Misc. Expense
	Office Supplies Expense
	Business License Expense
	Advertising Expense
	Wages Expense
	Telephone Expense
	Cost of Goods Sold (FIFO)
30-Sep	Income Summary (FIFO)	-
	Retained Earnings FIFO		-
30-Sep	Retained Earnings
	Dividends
		-	-

Peyton Approved
Statement of Retained Earnings
For Year Ending 12/31/2017
	Beginning Balance:		-
	plus Net Income
	less Dividends:
	Ending Balance:		-

Peyton Approved
Balance Sheet
As of December 31, 2017
Assets					Liabilities and Owners' Equity
	Current Assets:					Current Liabilities:
	Cash					Accounts Payable
	Baking Supplies					Wages Payable
	Merchandise Inventory (FIFO)		27,850.00			Interest Payable
	Prepaid Rent					Total Current Liabilities		-
	Prepaid Insurance
	Office Supplies		250.00			Long Term Liabilities:
	Accounts Receivable					Notes Payable
	Total Current Assets		-			Loans Payable
						Total Long Term Liabilities:		-
						Total Liabilities:		-
	Long Term/Fixed Assets:
	Baking Equipment					Common Stock
	Accumulated Depreciation					Retained Earnings
			-
	Leasehold Improvements					Total Equity		-
	Accumulated Amortization		-
	Trademark
	Total Assets:		-			Total Liabilities & Equity		-

	2017	2016	2015	Industry Standard
Quick Ratio		2.2	2.8	1.75
Gross Margin		0.55	0.7	0.7
Net Margin		0.22	0.32	0.24
Return on Sales		0.24	0.26	0.23
Return on Equity		0.9	0.78	0.8