Wells Technical Institute (WTI), a school owned by Tristana Wells, provides training to individuals who pay tuition directly to the school. WTI also offers training to groups in off-site locations. WTI initially records prepaid expenses and unearned revenues in balance sheet accounts. Its unadjusted trial balance as of December 31 follows along with descriptions of items a through h that require adjusting entries on December 31. Additional Information Items An analysis of WTI's insurance policies shows that $2,939 of coverage has expired. An inventory count shows that teaching supplies costing $2,547 are available at year-end. Annual depreciation on the equipment is $11,756. Annual depreciation on the professional library is $5,878. On September 1, WTI agreed to do five courses for a client for $2,300 each. Two courses will start immediately and finish before the end of the year. Three courses will not begin until next year. The client paid $11,500 cash in advance for all five courses on September 1, and WTI credited Unearned Training Fees. On October 15, WTI agreed to teach a four-month class (beginning immediately) for an executive with payment due at the end of the class. At December 31, $8,700 of the tuition has been earned by WTI. WTI's two employees are paid weekly. As of the end of the year, two days' salaries have accrued at the rate of $100 per day for each employee. The balance in the Prepaid Rent account represents rent for December. WELLS TECHNICAL INSTITUTE Unadjusted Trial Balance December 31 Debit Credit Cash $ 27,245 Accounts receivable 0 Teaching supplies 10,478 Prepaid insurance 15,719 Prepaid rent 2,097 Professional library 31,436 Accumulated depreciationProfessional library $ 9,432 Equipment 100,000 Accumulated depreciationEquipment 16,768 Accounts payable 22,000 Salaries payable 0 Unearned training fees 11,500 Common stock 24,057 Retained earnings 85,000 Dividends 41,916 Tuition fees earned 106,885 Training fees earned 39,820 Depreciation expenseProfessional library 0 Depreciation expenseEquipment 0 Salaries expense 50,300 Insurance expense 0 Rent expense 23,067 Teaching supplies expense 0 Advertising expense 7,336 Utilities expense 5,868 Totals $ 315,462 $ 315,462

3-a. Prepare Wells Technical Institute's income statement for the year.

3-b. Prepare Wells Technical Institute's statement of retained earnings for the year. The Retained Earnings account balance was $85,000 on December 31 of the prior year.

3-c. Prepare Wells Technical Institute's balance sheet as of December 31.