The following unadjusted trial balance contains the accounts and balances of Dylan Delivery Company as of December 31. a. Unrecorded depreciation on the trucks at the end of the year is $9,054. b. The total amount of accrued interest expense at year-end is $8,000. c. The cost of unused office supplies still available at year-end is $700. 1. Use the above information about the company's adjustments to complete a 10-column work sheet. 2a. Prepare the year-end closing entries for Dylan Delivery Company as of December 31. 2b. Determine the capital amount to be reported on the December 31, balance sheet. Note: S. Dylan, Capital was $231,260 on December 31 of the prior year.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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**Dylan Delivery Company: Year-End Adjustments and Closing Entries**

The following unadjusted trial balance contains the accounts and balances of Dylan Delivery Company as of December 31.

**Adjustments:**

a. Unrecorded depreciation on the trucks at the end of the year is $9,054.

b. The total amount of accrued interest expense at year-end is $8,000.

c. The cost of unused office supplies still available at year-end is $700.

**Tasks:**

1. **Use the above information about the company’s adjustments to complete a 10-column worksheet.**

2. **Year-End Closing Entries:**
   2a. Prepare the year-end closing entries for Dylan Delivery Company as of December 31.
   2b. Determine the capital amount to be reported on the December 31 balance sheet. 
   
   **Note:** S. Dylan, Capital was $231,260 on December 31 of the prior year.

---

### Notes for Completing the Worksheet and Closing Entries

**1. Completing the 10-Column Worksheet:**

The 10-column worksheet helps in organizing and adjusting the trial balance to prepare financial statements. The six columns (Adjustments, Adjustments Totals, Income Statement, and Balance Sheet) each serve to guide through the process:

- **Adjustments**: Include adjusting entries such as unrecorded depreciation, accrued interest expense, and the value of unused office supplies.
- **Adjusted Totals**: Sum of original balances and adjustments.
- **Income Statement**: Segregates the revenue and expenses to compute the net profit or loss.
- **Balance Sheet**: Segregates the asset, liability, and equity accounts to compute the ending balance.

**2a. Preparing Year-End Closing Entries:**

Year-end closing entries are journal entries made to transfer balances from temporary accounts (revenues, expenses) to permanent accounts (owner's equity).

**2b. Determining the Capital Amount:**

To find the ending capital amount to be reported on the balance sheet:

- Start with the beginning capital.
- Add: Net income (or subtract net loss).
- Subtract: Drawings or withdrawals by the owner.
  
Ensure that these tasks are marked accurately, with adjustments properly reflected in the appropriate worksheet columns.

**Conclusion:**
Follow the principles of accounting to compile, adjust, and summarize the financial data, providing a clear and accurate financial picture of Dylan Delivery Company as of December 31
Transcribed Image Text:**Dylan Delivery Company: Year-End Adjustments and Closing Entries** The following unadjusted trial balance contains the accounts and balances of Dylan Delivery Company as of December 31. **Adjustments:** a. Unrecorded depreciation on the trucks at the end of the year is $9,054. b. The total amount of accrued interest expense at year-end is $8,000. c. The cost of unused office supplies still available at year-end is $700. **Tasks:** 1. **Use the above information about the company’s adjustments to complete a 10-column worksheet.** 2. **Year-End Closing Entries:** 2a. Prepare the year-end closing entries for Dylan Delivery Company as of December 31. 2b. Determine the capital amount to be reported on the December 31 balance sheet. **Note:** S. Dylan, Capital was $231,260 on December 31 of the prior year. --- ### Notes for Completing the Worksheet and Closing Entries **1. Completing the 10-Column Worksheet:** The 10-column worksheet helps in organizing and adjusting the trial balance to prepare financial statements. The six columns (Adjustments, Adjustments Totals, Income Statement, and Balance Sheet) each serve to guide through the process: - **Adjustments**: Include adjusting entries such as unrecorded depreciation, accrued interest expense, and the value of unused office supplies. - **Adjusted Totals**: Sum of original balances and adjustments. - **Income Statement**: Segregates the revenue and expenses to compute the net profit or loss. - **Balance Sheet**: Segregates the asset, liability, and equity accounts to compute the ending balance. **2a. Preparing Year-End Closing Entries:** Year-end closing entries are journal entries made to transfer balances from temporary accounts (revenues, expenses) to permanent accounts (owner's equity). **2b. Determining the Capital Amount:** To find the ending capital amount to be reported on the balance sheet: - Start with the beginning capital. - Add: Net income (or subtract net loss). - Subtract: Drawings or withdrawals by the owner. Ensure that these tasks are marked accurately, with adjustments properly reflected in the appropriate worksheet columns. **Conclusion:** Follow the principles of accounting to compile, adjust, and summarize the financial data, providing a clear and accurate financial picture of Dylan Delivery Company as of December 31
### Dylan Delivery Company Work Sheet
**For the Year Ended December 31**

The following worksheet summarizes the unadjusted trial balance, adjustments, adjusted trial balance, income statement, and balance sheet for Dylan Delivery Company for the year ended December 31.

#### Account Details:

| Account Title                      | Unadjusted Trial Balance | Adjustments | Adjusted Trial Balance | Income Statement | Balance Sheet and Statement of Owner’s Equity |
|------------------------------------|:-------------:|:-----------:|:-------------:|:----------------:|----------------------------------------:|
|                                    |       Dr      |     Cr      |       Dr      |       Cr         |       Dr        |       Cr         |       Dr         |       Cr        |
| Cash                               | $ 16,500      |             |               |               |               |               |               |               |
| Accounts receivable                | 28,000        |             |               |               |               |               |               |               |
| Office supplies                    | 1,700         |             |               |               |               |               |               |               |
| Trucks                             | 280,000       |             |               |               |               |               |               |               |
| Accumulated depreciation—Trucks    |               | $ 50,000    |               |               |               |               |               |               |
| Land                               | 150,000       |             |               |               |               |               |               |               |
| Accounts payable                   |               | 25,905      |               |               |               |               |               |               |
| Interest payable                   |               | 4,000       |               |               |               |               |               |               |
| Long-term notes payable            |               | 100,000     |               |               |               |               |               |               |
| S. Dylan, Capital                  |               | 231,260     |               |               |               |               |               |               |
| S. Dylan, Withdrawals              | 38,000        |             |               |               |               |               |               |               |
| Delivery fees earned               |               | 301,785     |               |               |               |               |               |               |
| Depreciation expense—Trucks        | 50,000        |             |               |               |               |               |               |               |
| Salaries expense                   | 126,
Transcribed Image Text:### Dylan Delivery Company Work Sheet **For the Year Ended December 31** The following worksheet summarizes the unadjusted trial balance, adjustments, adjusted trial balance, income statement, and balance sheet for Dylan Delivery Company for the year ended December 31. #### Account Details: | Account Title | Unadjusted Trial Balance | Adjustments | Adjusted Trial Balance | Income Statement | Balance Sheet and Statement of Owner’s Equity | |------------------------------------|:-------------:|:-----------:|:-------------:|:----------------:|----------------------------------------:| | | Dr | Cr | Dr | Cr | Dr | Cr | Dr | Cr | | Cash | $ 16,500 | | | | | | | | | Accounts receivable | 28,000 | | | | | | | | | Office supplies | 1,700 | | | | | | | | | Trucks | 280,000 | | | | | | | | | Accumulated depreciation—Trucks | | $ 50,000 | | | | | | | | Land | 150,000 | | | | | | | | | Accounts payable | | 25,905 | | | | | | | | Interest payable | | 4,000 | | | | | | | | Long-term notes payable | | 100,000 | | | | | | | | S. Dylan, Capital | | 231,260 | | | | | | | | S. Dylan, Withdrawals | 38,000 | | | | | | | | | Delivery fees earned | | 301,785 | | | | | | | | Depreciation expense—Trucks | 50,000 | | | | | | | | | Salaries expense | 126,
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