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J. Smarly is a lawyer in practice by herself. The adjusted trial balance columns of the work sheet for J. Smarly, at June 30, 2018 are as follows: J. Smarly, Lawyer Adjusted Trial Balance For the Month Ended June 30, 2018 $25,000 9,000 Cash Accounts receivable Prepaid insurance 1,000 100,000 300,000 Land Building Accumulated amortization, building Notes payable Accounts payable Interest payable Mortgage payable J. Smarly, Capital J. Smarly, Drawings Legal fees Salaries expense $100,000 50,000 20,000 1,000 150,000 101,900 2,000 23,000 4,000 Insurance expense Amortization expense Supplies expense Interest expense Utilities expense 300 1,000 500 1,000 700 Property tax expense Promotional expenses 400 1,000 $445,900 $445,900 Instructions (a) Prepare a classified balance sheet at June 30, 2018. Assume that the mortgage liability is the only long-term liability. (b) Journalize the closing entries from the adjusted trial balance (assuming the books are closed quarterly). Action Plan In preparing a classified balance sheet, know the contents of each section. Assets should be listed in order of liquidity. In journalizing closing entries, remember that there are only three entries-one to close revenues, one to close expenses, and one to close owner's drawings directly to the owner's capital account.

J. Smarly is a lawyer in practice by herself. The adjusted trial balance columns of the work sheet for J. Smarly, at June 30, 2018 are as follows: J. Smarly, Lawyer Adjusted Trial Balance For the Month Ended June 30, 2018 $25,000 9,000 Cash Accounts receivable Prepaid insurance 1,000 100,000 300,000 Land Building Accumulated amortization, building Notes payable Accounts payable Interest payable Mortgage payable J. Smarly, Capital J. Smarly, Drawings Legal fees Salaries expense $100,000 50,000 20,000 1,000 150,000 101,900 2,000 23,000 4,000 Insurance expense Amortization expense Supplies expense Interest expense Utilities expense 300 1,000 500 1,000 700 Property tax expense Promotional expenses 400 1,000 $445,900 $445,900 Instructions (a) Prepare a classified balance sheet at June 30, 2018. Assume that the mortgage liability is the only long-term liability. (b) Journalize the closing entries from the adjusted trial balance (assuming the books are closed quarterly). Action Plan In preparing a classified balance sheet, know the contents of each section. Assets should be listed in order of liquidity. In journalizing closing entries, remember that there are only three entries-one to close revenues, one to close expenses, and one to close owner's drawings directly to the owner's capital account.

FINANCIAL ACCOUNTING
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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Prepare a classified balance sheet

J. Smarly is a lawyer in practice by herself. The adjusted trial balance columns of the work sheet for J. Smarly, at June 30, 2018 are as follows: J. Smarly, Lawyer Adjusted Trial Balance For the Month Ended June 30, 2018 Cash $25,000 9,000 1,000 Accounts receivable Prepaid insurance Land 100,000 300,000 Building Accumulated amortization, building Notes payable Accounts payable Interest payable Mortgage payable J. Smarly, Capital J. Smarly, Drawings Legal fees Salaries expense $100,000 50,000 20,000 1,000 150,000 101,900 2,000 23,000 4,000 300 Insurance expense Amortization expense Supplies expense Interest expense Utilities expense 1,000 500 1,000 700 Property tax expense Promotional expenses 400 1,000 $445,900 $445,900 Instructions (a) Prepare a classified balance sheet at June 30, 2018. Assume that the mortgage liability is the only long-term liability. (b) Journalize the closing entries from the adjusted trial balance (assuming the books are closed quarterly). Action Plan In preparing a classified balance sheet, know the contents of each section. Assets should be listed in order of liquidity. In journalizing closing entries, remember that there are only three entries-one to close revenues, one to close expenses, and one to close owner's drawings directly to the owner's capital account.
Transcribed Image Text:J. Smarly is a lawyer in practice by herself. The adjusted trial balance columns of the work sheet for J. Smarly, at June 30, 2018 are as follows: J. Smarly, Lawyer Adjusted Trial Balance For the Month Ended June 30, 2018 Cash $25,000 9,000 1,000 Accounts receivable Prepaid insurance Land 100,000 300,000 Building Accumulated amortization, building Notes payable Accounts payable Interest payable Mortgage payable J. Smarly, Capital J. Smarly, Drawings Legal fees Salaries expense $100,000 50,000 20,000 1,000 150,000 101,900 2,000 23,000 4,000 300 Insurance expense Amortization expense Supplies expense Interest expense Utilities expense 1,000 500 1,000 700 Property tax expense Promotional expenses 400 1,000 $445,900 $445,900 Instructions (a) Prepare a classified balance sheet at June 30, 2018. Assume that the mortgage liability is the only long-term liability. (b) Journalize the closing entries from the adjusted trial balance (assuming the books are closed quarterly). Action Plan In preparing a classified balance sheet, know the contents of each section. Assets should be listed in order of liquidity. In journalizing closing entries, remember that there are only three entries-one to close revenues, one to close expenses, and one to close owner's drawings directly to the owner's capital account.
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