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Pastina Company sells various types of pasta to grocery chains as private label brands. The company's reporting ear-end is December 31. The unadjusted trial balance as of December 31, 2021, appears below. Account Title Debits Cash Accounts receivable Supplies Inventory Notes receivable Interest receivable Prepaid rent Prepaid insurance. Office equipment Accumulated depreciation Accounts payable Salaries payable Notes payable Interest payable Deferred sales revenue Common stock Retained earnings Dividends Sales revenue Interest revenue Cost of goods sold Salaries expense Rent expense Depreciation expense Interest expense Supplies expense 30,000 40,000 1,500 60,000 20,000 -01 2,000 6,000 80,000 4,000 70,000 18,900 11,000 -0- -0- 1,100 Credits 30,000 31,000 -0- 50,000 -0- 2,000 60,000 28,500 146,000 -0-

Pastina Company sells various types of pasta to grocery chains as private label brands. The company's reporting ear-end is December 31. The unadjusted trial balance as of December 31, 2021, appears below. Account Title Debits Cash Accounts receivable Supplies Inventory Notes receivable Interest receivable Prepaid rent Prepaid insurance. Office equipment Accumulated depreciation Accounts payable Salaries payable Notes payable Interest payable Deferred sales revenue Common stock Retained earnings Dividends Sales revenue Interest revenue Cost of goods sold Salaries expense Rent expense Depreciation expense Interest expense Supplies expense 30,000 40,000 1,500 60,000 20,000 -01 2,000 6,000 80,000 4,000 70,000 18,900 11,000 -0- -0- 1,100 Credits 30,000 31,000 -0- 50,000 -0- 2,000 60,000 28,500 146,000 -0-

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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Question

Required:

Prepare the necessary December 31, 2021, adjusting journal entries.

Refer to P2−3and complete the following steps:

Step 1: Enter the unadjusted balances from the trial balance into T-accounts.
Step 2: Post the adjusting entries prepared in P 2-3 to the accounts.
Step 3: Prepare an adjusted trial balance.
Step 4: Prepare an income statement and a statement of shareholders equity for the year ended December 31.2021 . and a classified balance sheet as of December 31, 2021. Assume that no common stock was issued during the year and that$ 4,000 in cash dividends were paid to shareholders during the year. 
Step 5: Prepare closing entries and post to the accounts  
Step 6: Prepare a post-closing trial balance.
 
i need help with all of this
 
**Educational Content on Unadjusted Trial Balance** Pastina Company is engaged in selling various types of pasta to grocery chains as private label brands. The company's fiscal year ends on December 31. Below is the company's unadjusted trial balance as of December 31, 2021. **Unadjusted Trial Balance** *Account Title - Debits - Credits* 1. **Cash** - 30,000 2. **Accounts Receivable** - 40,000 3. **Supplies** - 1,500 4. **Inventory** - 60,000 5. **Notes Receivable** - 20,000 6. **Interest Receivable** - 0 7. **Prepaid Rent** - 2,000 8. **Prepaid Insurance** - 6,000 9. **Office Equipment** - 80,000 10. **Accumulated Depreciation** - 0 - 30,000 11. **Accounts Payable** - 0 - 31,000 12. **Salaries Payable** - 0 13. **Notes Payable** - 0 - 50,000 14. **Interest Payable** - 0 15. **Deferred Sales Revenue** - 0 - 2,000 16. **Common Stock** - 0 - 60,000 17. **Retained Earnings** - 0 - 28,500 18. **Dividends** - 4,000 19. **Sales Revenue** - 0 - 146,000 20. **Interest Revenue** - 0 21. **Cost of Goods Sold** - 70,000 22. **Salaries Expense** - 18,890 23. **Rent Expense** - 11,000 24. **Depreciation Expense** - 0 25. **Interest Expense** - 0 26. **Supplies Expense** - 1,100 27. **Insurance Expense** - 0 28. **Advertising Expense** - 3,000 **Total Debits**: 347,500 **Total Credits**: 347,500 Explanation of the balances: - **Assets**: Listed under debits which include cash, accounts receivable, supplies, inventory, and more. - **Liabilities and Equity**: Listed under credits
Transcribed Image Text:**Educational Content on Unadjusted Trial Balance** Pastina Company is engaged in selling various types of pasta to grocery chains as private label brands. The company's fiscal year ends on December 31. Below is the company's unadjusted trial balance as of December 31, 2021. **Unadjusted Trial Balance** *Account Title - Debits - Credits* 1. **Cash** - 30,000 2. **Accounts Receivable** - 40,000 3. **Supplies** - 1,500 4. **Inventory** - 60,000 5. **Notes Receivable** - 20,000 6. **Interest Receivable** - 0 7. **Prepaid Rent** - 2,000 8. **Prepaid Insurance** - 6,000 9. **Office Equipment** - 80,000 10. **Accumulated Depreciation** - 0 - 30,000 11. **Accounts Payable** - 0 - 31,000 12. **Salaries Payable** - 0 13. **Notes Payable** - 0 - 50,000 14. **Interest Payable** - 0 15. **Deferred Sales Revenue** - 0 - 2,000 16. **Common Stock** - 0 - 60,000 17. **Retained Earnings** - 0 - 28,500 18. **Dividends** - 4,000 19. **Sales Revenue** - 0 - 146,000 20. **Interest Revenue** - 0 21. **Cost of Goods Sold** - 70,000 22. **Salaries Expense** - 18,890 23. **Rent Expense** - 11,000 24. **Depreciation Expense** - 0 25. **Interest Expense** - 0 26. **Supplies Expense** - 1,100 27. **Insurance Expense** - 0 28. **Advertising Expense** - 3,000 **Total Debits**: 347,500 **Total Credits**: 347,500 Explanation of the balances: - **Assets**: Listed under debits which include cash, accounts receivable, supplies, inventory, and more. - **Liabilities and Equity**: Listed under credits
### Adjusting Journal Entries Explained The image details adjusting journal entries, which are made at the end of an accounting period to ensure that revenues and expenses are recognized in the period they occur. Below are the transactions depicted in the image: 1. **Depreciation Expense** - **Debit:** Depreciation Expense - $10,000 - **Credit:** Accumulated Depreciation - $10,000 2. **Salaries Expense** - **Debit:** Salaries Expense - $1,500 - **Credit:** Salaries Payable - $1,500 3. **Interest Expense** - **Debit:** Interest Expense - $1,500 - **Credit:** Interest Payable - $1,500 4. **Interest Receivable** - **Debit:** Interest Receivable - $1,333 - **Credit:** Interest Revenue - $1,333 5. **Insurance Expense** - **Debit:** Insurance Expense - $3,750 - **Credit:** Prepaid Insurance - $3,750 6. **Supplies Expense** - **Debit:** Supplies Expense - $700 - **Credit:** Supplies - $700 7. **Sales Revenue** - **Debit:** Unearned Revenue - $2,000 (not shown in the image but assumed for explanation) - **Credit:** Sales Revenue - $2,000 (not shown in the image but assumed for explanation) 8. **Rent Expense** - **Debit:** Rent Expense - $1,000 - **Credit:** Prepaid Rent - $1,000 ### Explanation of Each Transaction: 1. **Depreciation Expense:** - This entry accounts for the allocation of the cost of a tangible asset over its useful life. Debiting Depreciation Expense and crediting Accumulated Depreciation reduces the book value of the asset. 2. **Salaries Expense:** - This entry ensures that salaries earned but not yet paid are recorded in the correct period. The expense is recognized by debiting Salaries Expense and crediting Salaries Payable. 3. **Interest Expense:** - Similar to salaries, this entry ensures interest incurred but not yet paid is recorded. Debiting Interest Expense and crediting Interest Payable recognizes this liability. 4. **Interest Receivable:** - This entry records interest earned but not yet
Transcribed Image Text:### Adjusting Journal Entries Explained The image details adjusting journal entries, which are made at the end of an accounting period to ensure that revenues and expenses are recognized in the period they occur. Below are the transactions depicted in the image: 1. **Depreciation Expense** - **Debit:** Depreciation Expense - $10,000 - **Credit:** Accumulated Depreciation - $10,000 2. **Salaries Expense** - **Debit:** Salaries Expense - $1,500 - **Credit:** Salaries Payable - $1,500 3. **Interest Expense** - **Debit:** Interest Expense - $1,500 - **Credit:** Interest Payable - $1,500 4. **Interest Receivable** - **Debit:** Interest Receivable - $1,333 - **Credit:** Interest Revenue - $1,333 5. **Insurance Expense** - **Debit:** Insurance Expense - $3,750 - **Credit:** Prepaid Insurance - $3,750 6. **Supplies Expense** - **Debit:** Supplies Expense - $700 - **Credit:** Supplies - $700 7. **Sales Revenue** - **Debit:** Unearned Revenue - $2,000 (not shown in the image but assumed for explanation) - **Credit:** Sales Revenue - $2,000 (not shown in the image but assumed for explanation) 8. **Rent Expense** - **Debit:** Rent Expense - $1,000 - **Credit:** Prepaid Rent - $1,000 ### Explanation of Each Transaction: 1. **Depreciation Expense:** - This entry accounts for the allocation of the cost of a tangible asset over its useful life. Debiting Depreciation Expense and crediting Accumulated Depreciation reduces the book value of the asset. 2. **Salaries Expense:** - This entry ensures that salaries earned but not yet paid are recorded in the correct period. The expense is recognized by debiting Salaries Expense and crediting Salaries Payable. 3. **Interest Expense:** - Similar to salaries, this entry ensures interest incurred but not yet paid is recorded. Debiting Interest Expense and crediting Interest Payable recognizes this liability. 4. **Interest Receivable:** - This entry records interest earned but not yet
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