The trial balance before adjustment of Scenic Tours Inc. at the end of its first month of operations is presented below:

Other data:
1. The insurance policy has a one-year term beginning June 1, 1996.
2. The monthly depreciation is \(\$ 50\) on office equipment and \(\$ 2,000\) on buses.
3. Interest of \(\$ 700\) accrues on the notes payable each month.
4. Deposits of \(\$ 1,500\) each were received for advanced tour reservations from 10 school groups. At June 30, three of these deposits have been earned.
5. Bus drivers are paid a combined total of \(\$ 400\) per day. At June 30,3 days' salaries are unpaid.
6. A senior citizen's organization that had not made an advance deposit took a Canyon tour on June 30 for \(\$ 1,200\). This group was not billed for the services rendered until July 3 .
\section*{Instructions}

(a) Journalize the adjusting entries at June 30, 1996.

(b) Prepare a ledger using the three-column form of account. Enter the trial balance amounts and post the adjusting entries. (Use \(\sqrt{2}\) as the posting reference.)

(c) Prepare an adjusted trial balance at June 30, 1996.

Transcribed Image Text:

SCENIC TOURS INC. Trial Balance June 30, 1996 Debit Credit Cash $ 3,000 Prepaid Insurance 7,200 Office Equipment 1,800 Buses 140,000 Notes Payable $ 62,000 Unearned Fees 15,000 Common Stock 70,000 Fees Earned 15,900 Salaries Expense 9,000 Advertising Expense Gas and Oil Expense 800 1,100 $162,900 $162,900