"Y Problem 3-3A Preparing adjusting entries, adjusted trial balance, and financial statements LO A1, P1, P2, P3 (The following information applies to the questions displayed below. 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 a. An analysis of WTI's Insurance policies shows that $3,996 of coverage has expired. An Inventory count shows that teaching supplies costing $3,464 are avallable at year-end 2017. c. Annual depreciation on the equipment is $15,986. d. Annual depreciation on the professional library is $7.993, 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 $2,800, 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 $5,061 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) 9. 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. h. The balance in the Prepaid Rent account represents rent for December WELLS TECHNICAL INSTITUTE Unadjusted Trial Balance December 31, 2017 Credit Debit $ 27,094 10,420 15,632 2,085 31, 262 72,935 $ 9,380 16,675 34,976 Cash Accounts receivable Teaching supplies Prepaid insurance Prepaid rent Professional Library Accumulated depreciation-Professional Library Equipment Accumulated depreciation-Equipment Accounts payable Salaries payable Unearned training fees T. Wells, Capital T. Wells, Withdrawals Tuition fees earned Training fees earned Depreciation expense-Professional Library Depreciation expense-Equipment Salaries expense Insurance expense Rent expense Teaching supplies expense Advertising expense Utilities expense Totals 14,000 66, 277 41,684 106,293 39,599 @ 50,022 22,935 7,295 5,836 $ 287,200 $287,200 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 a. An analysis of WTI's insurance policies shows that $3,996 of coverage has expired. b. An inventory count shows that teaching supplies costing $3,464 are available at year-end 2017. c. Annual depreciation on the equipment is $15,986, d. Annual depreciation on the professional library is $7,993. 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 $2,800, 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 $5,061 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 WELLS TECHNICAL INSTTTUITE WELLS TECHNICAL INSTITUTE Unadjusted Trial Balance December 31, 2017 Credit Debit $ 27,094 10,420 15,632 2,085 31, 262 $ 9,380 72,935 Cash Accounts receivable Teaching supplies Prepaid insurance Prepaid rent Professional Library Accumulated depreciation-Professional library Equipment Accumulated depreciation-Equipment Accounts payable Salaries payable Unearned training fees T. Wells, Capital T. Wells, Withdrawals Tuition fees earned Training fees earned Depreciation expense-Professional library Depreciation expense-Equipment Salaries expense Insurance expense Rent expense Teaching supplies expense Advertising expense Utilities expense Totals 16,675 34,976 0 14,000 66, 277 41,684 106,293 39,599 0 0 50,022 22,935 0 7,295 5,836 $ 287,200 $287,200 Req 2A Reg 28 Post the balance from the unadjusted trial balance and the adjusting entries in to the T-accounts. Cash Equipment Unadj. Bal. Unadj. Bal. Adj. Bal. 0 Adj. Bal. 0 Accounts Recelvable Unadj. Bal Accumulated Depreciation Equipment Unadj. Bal Adj. Bal 0 Adj. Bal 0 Teaching Supplies Accounts Payable Unadj. Bal. Unadj. Bal Adj. Bal. 0 Adj. Bal. 0 Prepare an aujusieu tridi Udiance. WELLS TECHNICAL INSTITUTE Adjusted Trial Balance December 31, 2017 Debit Credit Cash Accounts receivable Teaching supplies Prepaid insurance Prepaid rent Professional library Accumulated depreciation-Professional Hbrary Equipment Accumulated depreciation Equipment Accounts payable Salaries payable Unearned training fees T. Wells, Capital T. Wells, Withdrawals Tuition fees earned Training fees earned Depreciation expense-Professional library Required information Accumulated depreciation-Professional library Equipment Accumulated depreciation Equipment Accounts payable Salaries payable Unearned training fees T. Wells, Capital T. Wells, Withdrawals Tuition fees earned Training fees earned Depreciation expense-Professional library Depreciation expense-Equipment Salaries expense Insurance expense Rent expense Teaching supplies expense Advertising expense Utilities expense Totals $ 0 $ 0