Sears Editing Company is a small editorial services company owned and operated by Deloris Sears. On January 31, 20Y1, the end of the current year, Sears Editing Company’s accounting clerk prepared the following unadjusted trial balance: Sears Editing CompanyUNADJUSTED TRIAL BALANCEJanuary 31, 20Y1 ACCOUNT TITLEDEBITCREDIT1Cash7,710.00 2Accounts Receivable37,935.00 3Prepaid Insurance7,070.00 4Supplies2,125.00 5Land108,400.00 6Building145,300.00 7Accumulated Depreciation-Building 85,610.008Equipment134,800.00 9Accumulated Depreciation-Equipment 96,100.0010Accounts Payable 12,625.0011Unearned Rent 6,340.0012Common Stock 75,495.0013Retained Earnings 144,195.0014Dividends15,120.00 15Fees Earned 323,700.0016Salaries and Wages Expense196,770.00 17Utilities Expense42,265.00 18Advertising Expense23,135.00 19Repairs Expense17,195.00 20Miscellaneous Expense6,240.00 21Totals744,065.00744,065.00 The data needed to determine year-end adjustments are as follows:a.Unexpired insurance at January 31, $6,105.b.Supplies on hand at January 31, $485.c.Depreciation of building for the year, $7,140.d.Depreciation of equipment for the year, $4,445.e.Rent unearned at January 31, $1,890.f.Accrued salaries and wages at January 31, $3,330.g.Fees earned but unbilled on January 31, $11,475. Required:1.Journalize the adjusting entries using the following additional accounts: Salaries and Wages Payable; Rent Revenue; Insurance Expense; Depreciation Expense—Building; Depreciation Expense—Equipment; and Supplies Expense. Refer to the Chart of Accounts for exact wording of account titles.2.Determine the balances of the accounts affected by the adjusting entries, and prepare an adjusted trial balance. CHART OF ACCOUNTSSears Editing CompanyGeneral Ledger ASSETS11Cash12Accounts Receivable13Prepaid Insurance14Supplies15Land16Building17Accumulated Depreciation-Building18Equipment19Accumulated Depreciation-Equipment LIABILITIES21Accounts Payable22Unearned Rent23Salaries and Wages Payable EQUITY31Common Stock32Retained Earnings33Dividends REVENUE41Fees Earned42Rent Revenue EXPENSES51Salaries and Wages Expense52Utilities Expense53Advertising Expense54Repairs Expense55Depreciation Expense-Building56Depreciation Expense-Equipment57Insurance Expense58Supplies Expense59Miscellaneous Expense 1. Journalize the adjusting entries using the following additional accounts: Salaries and Wages Payable; Rent Revenue; Insurance Expense; Depreciation Expense—Building; Depreciation Expense—Equipment; and Supplies Expense. Refer to the Chart of Accounts for exact wording of account titles.PAGE 10 JOURNALACCOUNTING EQUATION DATEDESCRIPTIONPOST. REF.DEBITCREDITASSETSLIABILITIESEQUITY1 Adjusting Entries 2 3 4 5 6 7 8 9 10 11 12 13 14 15 2. Determine the balances of the accounts affected by the adjusting entries, and prepare an adjusted trial balance. Sears Editing CompanyADJUSTED TRIAL BALANCEJanuary 31, 20Y1 ACCOUNT TITLEDEBITCREDIT1Cash 2Accounts Receivable 3Prepaid Insurance 4Supplies 5Land 6Building 7Accumulated Depreciation-Building 8Equipment 9Accumulated Depreciation-Equipment 10Accounts Payable 11Unearned Rent 12Salaries and Wages Payable 13Common Stock 14Retained Earnings 15Dividends 16Fees Earned 17Rent Revenue 18Salaries and Wages Expense 19Utilities Expense 20Advertising Expense 21Repairs Expense 22Depreciation Expense-Building 23Depreciation Expense-Equipment 24Insurance Expense 25Supplies Expense 26Miscellaneous Expense 27Totals

1)In Journal Equation all the Nominal Account items effects the Equity ( Revenues & Expenses) 2)…

Answered: 2. Determine the balances of the…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Sears Editing Company is a small editorial services company owned and operated by Deloris Sears. On January 31, 20Y1, the end of the current year, Sears Editing Company’s accounting clerk prepared the following unadjusted trial balance:

Sears Editing Company

UNADJUSTED TRIAL BALANCE

January 31, 20Y1

	ACCOUNT TITLE	DEBIT	CREDIT
1	Cash	7,710.00
2	Accounts Receivable	37,935.00
3	Prepaid Insurance	7,070.00
4	Supplies	2,125.00
5	Land	108,400.00
6	Building	145,300.00
7	Accumulated Depreciation-Building		85,610.00
8	Equipment	134,800.00
9	Accumulated Depreciation-Equipment		96,100.00
10	Accounts Payable		12,625.00
11	Unearned Rent		6,340.00
12	Common Stock		75,495.00
13	Retained Earnings		144,195.00
14	Dividends	15,120.00
15	Fees Earned		323,700.00
16	Salaries and Wages Expense	196,770.00
17	Utilities Expense	42,265.00
18	Advertising Expense	23,135.00
19	Repairs Expense	17,195.00
20	Miscellaneous Expense	6,240.00
21	Totals	744,065.00	744,065.00

The data needed to determine year-end adjustments are as follows:

a.	Unexpired insurance at January 31, $6,105.
b.	Supplies on hand at January 31, $485.
c.	Depreciation of building for the year, $7,140.
d.	Depreciation of equipment for the year, $4,445.
e.	Rent unearned at January 31, $1,890.
f.	Accrued salaries and wages at January 31, $3,330.
g.	Fees earned but unbilled on January 31, $11,475.

	Required:
1.	Journalize the adjusting entries using the following additional accounts: Salaries and Wages Payable; Rent Revenue; Insurance Expense; Depreciation Expense—Building; Depreciation Expense—Equipment; and Supplies Expense. Refer to the Chart of Accounts for exact wording of account titles.
2.	Determine the balances of the accounts affected by the adjusting entries, and prepare an adjusted trial balance.

CHART OF ACCOUNTS

Sears Editing Company

General Ledger

	ASSETS
11	Cash
12	Accounts Receivable
13	Prepaid Insurance
14	Supplies
15	Land
16	Building
17	Accumulated Depreciation-Building
18	Equipment
19	Accumulated Depreciation-Equipment

	LIABILITIES
21	Accounts Payable
22	Unearned Rent
23	Salaries and Wages Payable

	EQUITY
31	Common Stock
32	Retained Earnings
33	Dividends

	REVENUE
41	Fees Earned
42	Rent Revenue

	EXPENSES
51	Salaries and Wages Expense
52	Utilities Expense
53	Advertising Expense
54	Repairs Expense
55	Depreciation Expense-Building
56	Depreciation Expense-Equipment
57	Insurance Expense
58	Supplies Expense
59	Miscellaneous Expense

1. Journalize the adjusting entries using the following additional accounts: Salaries and Wages Payable; Rent Revenue; Insurance Expense; Depreciation Expense—Building; Depreciation Expense—Equipment; and Supplies Expense. Refer to the Chart of Accounts for exact wording of account titles.

PAGE 10

JOURNAL

ACCOUNTING EQUATION

	DATE	DESCRIPTION	POST. REF.	DEBIT	CREDIT	ASSETS	LIABILITIES	EQUITY
1		Adjusting Entries
2
3
4
5
6
7
8
9
10
11
12
13
14
15

2. Determine the balances of the accounts affected by the adjusting entries, and prepare an adjusted trial balance.

Sears Editing Company

ADJUSTED TRIAL BALANCE

January 31, 20Y1

	ACCOUNT TITLE	DEBIT	CREDIT
1	Cash
2	Accounts Receivable
3	Prepaid Insurance
4	Supplies
5	Land
6	Building
7	Accumulated Depreciation-Building
8	Equipment
9	Accumulated Depreciation-Equipment
10	Accounts Payable
11	Unearned Rent
12	Salaries and Wages Payable
13	Common Stock
14	Retained Earnings
15	Dividends
16	Fees Earned
17	Rent Revenue
18	Salaries and Wages Expense
19	Utilities Expense
20	Advertising Expense
21	Repairs Expense
22	Depreciation Expense-Building
23	Depreciation Expense-Equipment
24	Insurance Expense
25	Supplies Expense
26	Miscellaneous Expense
27	Totals

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