Willow Deng is the sole owner of Spinnaker Pty Ltd, a private company selling sailing accessories in Adelaide. He has been experiencing tremendous growth in his business in recent years. He has approached Best Accounting Solutions Pty Ltd to help develop improved accounting systems for his business. Assume you are a graduate accountant working for Best Accounting Solutions Pty Ltd and you are required to prepare the year-end Balance Day Adjustments Journals for Spinnaker Pty Ltd.

SPINNAKER PTY LTD

UNADJUSTED TRIAL BALANCE

AS AT 30 JUNE 2020

	Debit ($)	Credit ($)
Cash at Bank	90,700
Accounts Receivable	60,000
Inventory (30 June 2020)	48,845
Prepaid Insurance	6,000
Supplies	5,600
Office Equipment	80,000
Accumulated Depreciation Off. Equip.		30,800
Land Bank Loan	25,600	50,000
Willow Deng , Capital (1 July 2019)		192,420
Willow Deng , Drawings	23,500
Sales Revenue Unearned Sales Revenue		345,400 6,870
Sales Returns & Allowances	9,670
Salaries Expense	34,600
Cost of Sales	187,500
Freight inward	7,865
Rental Income		20,100
Rent Expense	33,000
Interest Expense	4,900
Electricity and Gas Expense Discount allowed	4,690 9,000
Insurance Expense	6,230
Advertising Expense	7,890	. .
	$645,590	$645,590

Additional information:

1. Office Equipment is expected to have a useful life of 10 years and will then be sold for an estimated amount of $3,000.
2. Accrued salaries expense at 30 June is $4,876.
3. $9,500 of the recorded sales represents payments for goods which will not be delivered until July 2020.
4. A physical count shows supplies of $1,450 on hand at 30 June.
5. The prepaid insurance was paid for twelve months commencing 1st March.
6. A physical stock take of inventory at 30 June reveals $47,000 on hand.
7. Upon receipt of the businesss bank statement, it was observed that the business had earned $1,050 rental income on 30 June 2020. This amount was directly paid by a tenant into the businesss bank account. The accounting records need to be updated for this transaction.
8. It is estimated that 3% of the 30 June balance of accounts receivable are unlikely to be received.
9. A payment of $5,029 on 20 May for advertising expense has been incorrectly debited to freight inward account.

REQUIRED:

It is now the end of the financial year and based on the information Willow has provided above, the CEO of Best Accounting Solutions Pty Ltd (Lisa Turner) has asked you to prepare any necessary balance day adjusting journals.

Use the General Journal document provided on the following page to record any journal entries required.

All journals must be correctly formatted and include a narration (explanation) for each entry.