2-a. Post the balance from the unadjusted trial balance and the adjusting entrie

Question

2-a. Post the balance from the unadjusted trial balance and the adjusting entries in to the T-accounts.
2-b. Prepare an adjusted trial balance.

[The following information applies to the questions displayed below.]

Wells Technical Institute (WTI), a school owned by Tristana Wells, provides training to individuals who pay tuition directly to the school. WTI also offers training to groups in off-site locations. Its unadjusted trial balance as of December 31, 2017, follows. WTI initially records prepaid expenses and unearned revenues in balance sheet accounts. Descriptions of items athrough h that require adjusting entries on December 31, 2017, follow.
  
Additional Information Items

An analysis of WTI's insurance policies shows that $2,674 of coverage has expired.

An inventory count shows that teaching supplies costing $2,318 are available at year-end 2017.

Annual depreciation on the equipment is $10,698.

Annual depreciation on the professional library is $5,349.

On November 1, WTI agreed to do a special six-month course (starting immediately) for a client. The contract calls for a monthly fee of $2,800, and the client paid the first five months' fees in advance. When the cash was received, the Unearned Training Fees account was credited. The fee for the sixth month will be recorded when it is collected in 2018.

On October 15, WTI agreed to teach a four-month class (beginning immediately) for an individual for $2,461 tuition per month payable at the end of the class. The class started on October 15, but no payment has yet been received. (WTI's accruals are applied to the nearest half-month; for example, October recognizes one-half month accrual.)

WTI's two employees are paid weekly. As of the end of the year, two days' salaries have accrued at the rate of $100 per day for each employee.

The balance in the Prepaid Rent account represents rent for December.

WELLS TECHNICAL INSTITUTE
Unadjusted Trial Balance
December 31, 2017 Debit Credit Cash $ 27,094 Accounts receivable 0 Teaching supplies 10,420 Prepaid insurance 15,632 Prepaid rent 2,085 Professional library 31,262 Accumulated depreciation—Professional library $ 9,380 Equipment 72,935 Accumulated depreciation—Equipment 16,675 Accounts payable 34,976 Salaries payable 0 Unearned training fees 14,000 Common stock 14,000 Retained earnings 52,277 Dividends 41,684 Tuition fees earned 106,293 Training fees earned 39,599 Depreciation expense—Professional library 0 Depreciation expense—Equipment 0 Salaries expense 50,022 Insurance expense 0 Rent expense 22,935 Teaching supplies expense 0 Advertising expense 7,295 Utilities expense 5,836 Totals $ 287,200 $ 287,200

Explanation / Answer

1..Adjusting entries Account Titles Debit Credit Insurance expense 2674 Prepaid Insurance 2674 Teaching supplies expense 8102 Teaching supplies 8102 (10420-2318) Depreciation expense-Equipment 10698 Accumulated depreciation-Equipment 10698 Depreciation expense-Professional Library 5349 Accumulated depreciation-Professional Library 5349 Unearned Training fees 5600 Training fees earned 5600 (2800*2 mths.) Accounts receivable 6152.5 Tution fees earned 6152.5 (2461*2.5 mths.) Salaries expense 400 Salaries payable 400 (100*2 emp.*2 days) Rent expense 2085 Prepaid rent 2085 Trial Balance as at 12/31/2017 Unadjusted T/B Adjusting Entries Adjusted T/B Debit Credit Debit Credit Debit Credit Cash 27,094 27,094 Accounts receivable 0 6152.5 6,152.5 Teaching supplies 10,420 -8102 2,318 Prepaid insurance 15,632 -2674 12,958 Prepaid rent 2,085 -2085 0 Professional library 31,262 31,262 Accumulated depreciation—Professional library 9,380 5349 14,729 Equipment 72,935 72,935 Accumulated depreciation—Equipment 16,675 10698 27,373 Accounts payable 34,976 34,976 Salaries payable 0 400 400 Unearned training fees 14,000 -5600 8,400 Common stock 14,000 14,000 Retained earnings 52,277 52,277 Dividends 41,684 41,684 Tuition fees earned 106,293 6152.5 112,445.5 Training fees earned 39,599 5600 45,199 Depreciation expense—Professional library 0 5349 5,349 Depreciation expense—Equipment 0 10698 10,698 Salaries expense 50,022 400 50,422 Insurance expense 0 2674 2,674 Rent expense 22,935 2085 25,020 Teaching supplies expense 0 8102 8,102 Advertising expense 7,295 7,295 Utilities expense 5,836 5,836 Totals 287,200 287,200 22,599.5 22,599.5 309,799.5 309,799.5

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