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. Its unadjusted trial balance as of December 31, 2017, follows. WTI initially records prepaid expenses and unearned revenues in balance sheet accounts. Descriptions of items a through h that require adjusting entries on December 31, 2017, follow. Additional Information Items An analysis of WTI's insurance policies shows that $3,600 of coverage has expired. An inventory count shows that teaching supplies costing $3,120 are available at year-end 2017. Annual depreciation on the equipment is $14,400. Annual depreciation on the professional library is $7,200. On November 1, WTI agreed to do a special six-month course (starting immediately) for a client. The contract calls for a monthly fee of $2,700, and the client paid the first five months' fees in advance. When the cash was received, the Unearned Training Fees account was credited. The fee for the sixth month will be recorded when it is collected in 2018. On October 15,

WTI agreed to teach a four-month class (beginning immediately) for an individual for $4,380 tuition per month payable at the end of the class. The class started on October 15, but no payment has yet been received. (WTI's accruals are applied to the nearest half-month; for example, October recognizes one-half month accrual.)

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, 2017

Debit

Cash- $27,547

Accounts receivable- 0

Teaching supplies- 10,594

Prepaid insurance- 15,894

Prepaid rent- 2,120

Professional library- 31,784

Equipment- 74,152

Dividends- 42,381

Depreciation expenseProfessional library 0

Depreciation expenseEquipment 0

Salaries expense 50,858

Insurance expense- 0

Rent expense- 23,320

Teaching supplies expense- 0

Advertising expense -7,417

Utilities expense -5,933

$ 292,000

Credit

Accumulated depreciationProfessional library

$

9,537

Accumulated depreciationEquipment

16,954

Accounts payable

36,294

Salaries payable

0

Unearned training fees

13,500

Common stock

14,000

Retained earnings

53,385

Tuition fees earned

108,069

Training fees earned

40,261

Problem 3-3A Part 2 2-a. Post the balance from the unadjusted trial balance and the adjusting entries in to the T-accounts. 2-b. Prepare an adjusted trial balance .

Additional Information Items

A. An analysis of WTI's insurance policies shows that $3,600 of coverage has expired.

B. An inventory count shows that teaching supplies costing $3,120 are available at year-end 2017.

C. Annual depreciation on the equipment is $14,400.

D. Annual depreciation on the professional library is $7,200.

E. On November 1, WTI agreed to do a special six-month course (starting immediately) for a client. The contract calls for a monthly fee of $2,700, and the client paid the first five months' fees in advance. When the cash was received, the Unearned Training Fees account was credited. The fee for the sixth month will be recorded when it is collected in 2018.

F. On October 15, WTI agreed to teach a four-month class (beginning immediately) for an individual for $4,380 tuition per month payable at the end of the class. The class started on October 15, but no payment has yet been received. (WTI's accruals are applied to the nearest half-month; for example, October recognizes one-half month accrual.)

G. 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.

H. The balance in the Prepaid Rent account represents rent for December.

Prepare Wells Technical Institute's balance sheet as of December 31, 2017.

WELLS TECHNICAL INSTITUTE
Balance Sheet
December 31, 2017
Assets
Cash
Accounts receivable
Teaching supplies
Prepaid insurance
Professional library
Accumulated depreciationProfessional library
Depreciation expenseEquipment
Equipment
Liabilities
		0
Equity
Total equity