Presented below are the trial balance and the other information related to Yorkis Perez, a… 1 answer below »

P-6 Presented below are the trial balance and the other information related to Yorkis Perez, a consulting engineer.

YORKIS PEREZ, CONSULTING ENGINEER
TRIAL BALANCE
DECEMBER 31, 2012

Debit

Credit

Cash

$29,500

Accounts Receivable

49,600

Allowance for Doubtful Accounts

Inventory

1,960

Prepaid Insurance

1,100

Equipment

$25,000

Accumulated Depreciation—Equipment

6,250

Notes Payable

7,200

Owner’s Capital

35,010

Service Revenue

100,000

Rent Expense

9,750

Salaries and Wages Expense

30,500

Utilities Expenses

$1,080

Offi ce Expense

720

$149,210

$149,210

1. Fees received in advance from clients $6,000.

2. Services performed for clients that were not recorded by December 31, $4,900.

3. Bad debt expense for the year is $1,430.

4. Insurance expired during the year $480.

5. Equipment is being depreciated at 10% per year.

6. Yorkis Perez gave the bank a 90-day, 10% note for $7,200 on December 1, 2012.

7. Rent of the building is $750 per month. The rent for 2012 has been paid, as has that for January 2013.

8. Office salaries and wages earned but unpaid December 31, 2012, $2,510.

Instructions

(a) From the trial balance and other information given, prepare annual adjusting entries as of December 31, 2012. (Omit explanations.)

(b) Prepare an income statement for 2012, a statement of owner’s equity, and a classified balance sheet. Yorkis Perez withdrew $17,000 cash for personal use during the year.

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