The following information are available: 1. Cate did not bill yet the client for legal services rendered on December 28. On December 29, they won the case and billed the client on January 8, 2022 amounting to 74,780 2. Cate received 52,000 for the services that are yet to be performed on January 2022 to May 2022. 60% will allocate to legal and remaining to accounting. Cate did not record this transaction to her books. 3. A cafeteria is behind on space rental revenue, and this 10,000 of accrued revenues was unrecorded at the time the trial balance was prepared. 4. 34,840 of Unearned Rent account balance was still unearned at year-end 5. Computers and Equipment was bought on January 1, 2019 with 3,600 salvage value and estimated useful life of 6 years. Cate did not record yet any adjustments for 2021. 6. Building are being depreciated starting 2017 with 25,000 salvage value and estimated useful life of 40 years. Cate did not record yet any adjustments for 2021. 7. Actual drawing shows 12,500 instead of 15,200 8. Prepaid life insurance was paid in full last July 1, 2021. The life insurance are for 15 months period. 9. Prepaid building insurance was paid in full last September 1, 2021. The building insurance are for 3 years period. 10. The one employee, a secretary, works a five-day workweek at 1,000 per day. The employee was paid last week but has worked Wednesday through Friday this week for which she has not been paid. 11. Cate has four assistants who each earn 800 per day for a five-day workweek that ends on Friday. The employees were paid last Friday and worked full days on Monday to Friday this week for which they have not been paid 12. Loan payable at 12% every year was borrowed last April 1, 2021. The loan will be repaid after 5 years Supplies on hand values at 33,190 Actual utility bill will receive on January 10, 2022 amounting to 18,770 1,890 to be accrued as interest on bank statement base on bank's prevailing interest. The interest is not yet shown in the current bank statement due to system error. It's expected that this will appear on January 2022. Required: 1. Prepare the adjusting journal entries 2. Prepare a worksheet to show the unadjusted trial balance, adjustments and adjusted trial balance

The following information are available: 1. Cate did not bill yet the client for legal services rendered on December 28. On December 29, they won the case and billed the client on January 8, 2022 amounting to 74,780 2. Cate received 52,000 for the services that are yet to be performed on January 2022 to May 2022. 60% will allocate to legal and remaining to accounting. Cate did not record this transaction to her books. 3. A cafeteria is behind on space rental revenue, and this 10,000 of accrued revenues was unrecorded at the time the trial balance was prepared. 4. 34,840 of Unearned Rent account balance was still unearned at year-end 5. Computers and Equipment was bought on January 1, 2019 with 3,600 salvage value and estimated useful life of 6 years. Cate did not record yet any adjustments for 2021. 6. Building are being depreciated starting 2017 with 25,000 salvage value and estimated useful life of 40 years. Cate did not record yet any adjustments for 2021. 7. Actual drawing shows 12,500 instead of 15,200 8. Prepaid life insurance was paid in full last July 1, 2021. The life insurance are for 15 months period. 9. Prepaid building insurance was paid in full last September 1, 2021. The building insurance are for 3 years period. 10. The one employee, a secretary, works a five-day workweek at 1,000 per day. The employee was paid last week but has worked Wednesday through Friday this week for which she has not been paid. 11. Cate has four assistants who each earn 800 per day for a five-day workweek that ends on Friday. The employees were paid last Friday and worked full days on Monday to Friday this week for which they have not been paid 12. Loan payable at 12% every year was borrowed last April 1, 2021. The loan will be repaid after 5 years Supplies on hand values at 33,190 Actual utility bill will receive on January 10, 2022 amounting to 18,770 1,890 to be accrued as interest on bank statement base on bank's prevailing interest. The interest is not yet shown in the current bank statement due to system error. It's expected that this will appear on January 2022. Required: 1. Prepare the adjusting journal entries 2. Prepare a worksheet to show the unadjusted trial balance, adjustments and adjusted trial balance

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

The following information are available:

1. Cate did not bill yet the client for legal services rendered on December 28. On December 29, they won the case and billed the client on January 8, 2022 amounting to 74,780

2. Cate received 52,000 for the services that are yet to be performed on January 2022 to May 2022. 60% will allocate to legal and remaining to accounting. Cate did not record this transaction to her books.

3. A cafeteria is behind on space rental revenue, and this 10,000 of accrued revenues was unrecorded at the time the trial balance was prepared.

4. 34,840 of Unearned Rent account balance was still unearned at year-end

5. Computers and Equipment was bought on January 1, 2019 with 3,600 salvage value and estimated useful life of 6 years. Cate did not record yet any adjustments for 2021.

6. Building are being depreciated starting 2017 with 25,000 salvage value and estimated useful life of 40 years. Cate did not record yet any adjustments for 2021.

7. Actual drawing shows 12,500 instead of 15,200

8. Prepaid life insurance was paid in full last July 1, 2021. The life insurance are for 15 months period.

9. Prepaid building insurance was paid in full last September 1, 2021. The building insurance are for 3 years period.

10. The one employee, a secretary, works a five-day workweek at 1,000 per day. The employee was paid last week but has worked Wednesday through Friday this week for which she has not been paid.

11. Cate has four assistants who each earn 800 per day for a five-day workweek that ends on Friday. The employees were paid last Friday and worked full days on Monday to Friday this week for which they have not been paid

12. Loan payable at 12% every year was borrowed last April 1, 2021. The loan will be repaid after 5 years

Supplies on hand values at 33,190
Actual utility bill will receive on January 10, 2022 amounting to 18,770
1,890 to be accrued as interest on bank statement base on bank's prevailing interest. The interest is not yet shown in the current bank statement due to system error. It's expected that this will appear on January 2022.

Required:

1. Prepare the adjusting journal entries

2. Prepare a worksheet to show the unadjusted trial balance, adjustments and adjusted trial balance

Atty. Cate, CPA Legal and Accounting Services
Unadjusted Trial Balance
December 31, 2021
Account
Reference Debit
Credit
Cash
121,220.00
Cash in bank
188,200.00
Accounts Receivable
Prepaid Life Insurance
Prepaid Building Insurance
Computers and equipment
67,560.00
52,500.00
84,600.00
102,900.00
Accumulated Depreciation - Computers and equipment
Building
33,100.00
525,000.00
Accumulated Depreciation - Building
50,000.00
Land
1,260,000.00
Accounts Payable
225,600.00
Unearned Rent Revenue
128,400.00
Long term Notes Payable
580,000.00
Cate, Capital
Cate, Drawing
1,000,000.00
15,200.00
Professional Service Revenue - Legal
234,420.00
Professional Service Revenue - Accounting
154,080.00
Rental Revenue
150,000.00
Wages Expense
Supplies Expense
64,800.00
73,620.00
TOTAL
2,555,600.00 2,555,600.00

Please refer to the following data and prepare the requirements.
Atty. Cate, CPA Legal and Accounting Services
Chart of Accounts
December 31, 2021
Account
Reference
Cash
100
Cash in bank
101
Accounts Receivable
102
Interest Receivable
103
Supplies
Prepaid Life Insurance
Prepaid Building Insurance
Computers and equipments
Accumulated Depreciation - Computers and equipments
Building
Accumulated Depreciation - Building
104
105
106
150
151
152
153
Land
154
Accounts Payable
Wages Payable
Utility Payable
Interest Payable
Unearned Professional Service Revenue - Legal
Unearned Professional Service Revenue - Accounting
200
201
202
203
204
205
Unearned Rent Revenue
206
Long term Notes Payable
Cate, Capital
Cate, Drawing
Professional Service Revenue - Legal
Professional Service Revenue - Accounting
250
300
301
400
401
Rental Revenue
402
Interest Revenue
403
Wages Expense
Supplies Expense
Utility Expense
Interest Expense
Depreciation Expense - Computers and Equipment
Depreciation Expense - Building
Life Insurace Expense
Building Insurance Expense
500
501
502
503
504
505
506
507

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