The unadjusted trial balance of Price Waterhouse Company at December 31, 2021, and the data needed for the adjustments follow. PRICE WATERHOUSE COMPANY (Unadjusted) Trial Balance December 31, 2021 Account Title Balance Debit Credit Cash $ 7,100 Accounts Receivable 19,100 Prepaid Rent 2,400 Office Supplies 1,400 Equipment 20,000 Accumulated Depreciation—Equipment $ 3,800 Accounts Payable 3,500 Salaries Payable 0 Unearned Revenue 2,700 Price, Capital 39,300 Price, Withdrawals 9,400 Service Revenue 15,900 Salaries Expense 3,900 Rent Expense 0 Depreciation Expense—Equipment 0 Advertising Expense 1,900 Supplies Expense 0 Total $ 65,200 $ 65,200 Adjustment data at December 31 follow: a. On December 15, Price contracted to perform services for a client receiving $2,700 in advance. Price recorded this receipt of cash as Unearned Revenue. As of December 31, Price has completed $2,100 of the services. b. Price prepaid two months of rent on December 1. (Assume the Prepaid Rent balance as shown on the unadjusted trial balance represents the two months of rent prepaid on December 1.) c. Price used $750 of office supplies during the month. d. Depreciation for the equipment is $800. e. Price received a bill for December’s online advertising, $500. Price will not pay the bill until January. (Use Accounts Payable.) f. Price pays its employees weekly on Monday for the previous week’s wages. Its employees earn $2,000 for a five-day workweek. December 31 falls on Wednesday this year. g. On October 1, Price agreed to provide a four-month consulting service (beginning October 1) for a customer for $2,800. Price has completed the consulting service every month, but payment has not yet been received and no entries have been made. Requirements 1. Journalize the adjusting entries on December 31. 2. Using the unadjusted trial balance, open the T-accounts with the unadjusted balances. Post the adjusting entries to the T-accounts. 3. Prepare the adjusted trial balance. 4. Prepare the income statement, the statement of owner’s equity for the year ended December 31, 2021 and the financial position as of December 31 2021 of Price Waterhouse Company.
The unadjusted trial balance of Price Waterhouse Company at December 31, 2021, and the data needed for the adjustments follow.
| PRICE WATERHOUSE COMPANY | ||
| (Unadjusted) Trial Balance | ||
| December 31, 2021 | ||
| Account Title | Balance | |
| Debit | Credit | |
| Cash | $ 7,100 | |
| Accounts Receivable | 19,100 | |
| Prepaid Rent | 2,400 | |
| Office Supplies | 1,400 | |
| Equipment | 20,000 | |
| Accumulated Depreciation—Equipment | $ 3,800 | |
| Accounts Payable | 3,500 | |
| Salaries Payable | 0 | |
| Unearned Revenue | 2,700 | |
| Price, Capital | 39,300 | |
| Price, Withdrawals | 9,400 | |
| Service Revenue | 15,900 | |
| Salaries Expense | 3,900 | |
| Rent Expense | 0 | |
| Depreciation Expense—Equipment | 0 | |
| Advertising Expense | 1,900 | |
| Supplies Expense | 0 | |
| Total | $ 65,200 | $ 65,200 |
Adjustment data at December 31 follow:
a. On December 15, Price contracted to perform services for a client receiving $2,700 in advance. Price recorded this receipt of cash as Unearned Revenue. As of December 31, Price has completed $2,100 of the services.
b. Price prepaid two months of rent on December 1. (Assume the Prepaid Rent balance as shown on the unadjusted trial balance represents the two months of rent prepaid on December 1.)
c. Price used $750 of office supplies during the month.
d. Depreciation for the equipment is $800.
e. Price received a bill for December’s online advertising, $500. Price will not pay the bill until January. (Use Accounts Payable.)
f. Price pays its employees weekly on Monday for the previous week’s wages. Its employees earn $2,000 for a five-day workweek. December 31 falls on Wednesday this year.
g. On October 1, Price agreed to provide a four-month consulting service (beginning October 1) for a customer for $2,800. Price has completed the consulting service every month, but payment has not yet been received and no entries have been made.
Requirements
1. Journalize the adjusting entries on December 31.
2. Using the unadjusted trial balance, open the T-accounts with the unadjusted balances.
Post the adjusting entries to the T-accounts.
3. Prepare the adjusted trial balance.
4. Prepare the income statement, the statement of owner’s equity for the year ended
December 31, 2021 and the financial position as of December 31 2021 of Price
Waterhouse Company.
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