Trial Balance IS 12-31-16 2016 Cash Flows Silver Tone Partners, Inc. Trial Balan

Question

Trial Balance IS 12-31-16 2016 Cash Flows Silver Tone Partners, Inc. Trial Balance Work sheot 12/31/16 123116 10000-Cash- Checking 12000-Accounts Recelivable 13200-Inventory 15000-Furniture and Equipment 17000-Acumulated Depreciation 18000-Prepaid Rent 8700-Propaid Insurance 20000-Accounts Payable 21000-Payroll Payable 23000-Accrued Expenses 24000-Note Payable-Current 28000- Note Payable-Long Term 0100-Capital Stock 195,500 21,000 3,000 312,000 13,000 500 7 ,000 12,000 2.00 42,500 2,000 500 38,0007 1,000 12,000 7 88,000 7 1,000 1,000 30200-Dividends Paid 210,000 378,750 32000-Retained Eamings 210,000 47900-Sales 51000-Cost of Goods Sold 153,750 62400-Depreciation Expense 63300-Insurance Expense 63400-Interest Expense 8,500 10,000 800 400 102.000 3,000 43,300 17,000 7.500 64300-Meals and Entertainment 64900-Office Supplies 65600-Payroll Expenses 66700-Professional Fees 66750-Rent Expense |68400-Travel Expense 68600-Utes 256 500 5 258,500 5 741 250 741250 2 Upon review of the 2016 financial records the following information was determined by the Accounting Manager and he made he appropriate Adjusting Journal Entries in the accounting records 71. The Company paid an additional cash dividend on 12/31/16 in the amount of $2.000, which had not yet been recorded 2 Upon analyzing Rent Expense it was determined that the expense account was overstated by $1,000 and that amount should be reclassified to Prepsid Rent nd should be $3.000 ·3. Upon reviewing the insurance policy was determihed that the proper balance at year 9 4. Upon reviewing the paymall reports from Paychex it was determined that the amount of unpaid payroll as of 1231/16 was only $8,000 5. Ucon reviewing the depreciation poicy, was determined the depreciation expense to be $2,000 for the year

Explanation / Answer

12/31/2015 12/31/2016 12/31/2016 12/31/2016 12/31/2016 12/31/2016 Post closing trial balance Unadjusted trial balance Adjusting entries (Note:1) Adjusted trial balance Closing entries (Note:2) Post closing trial balance Debit Credit Debit Credit Debit Credit Debit Credit Debit Credit Debit Credit 10000-Cash -checking 195500 312000 2000 310000 310000 12000-Accounts receivable 21000 46750 46750 46750 13200-Inventory 35000 6250 6250 6250 15000-Furniture & equipment 3000 13000 13000 13000 17000-Accumulated depreciation 500 500 2000 2500 2500 18000-Prepaid rent - 3000 1000 4000 4000 18700-Prepaid insurance 2000 12000 9000 3000 3000 20000-Accounts payable 42500 38000 38000 38000 21000-Payroll payable 2000 11000 8000 19000 19000 23000-Accrued expenses 500 2000 2000 2000 24000-Notes payable-current - 12000 12000 12000 28000-Notes payable-long term - 88000 88000 88000 30100-Capital stock 1000 1000 1000 1000 30200-Dividends paid 2000 2000 4000 4000 - 32000-Retained earnings 210000 210000 210000 4000 14500 220500 47900-Sales 378750 378750 378750 51000-Cost of goods sold 153750 153750 153750 62400-Depreciation expense - 2000 2000 2000 63000-Insurance expense 8500 9000 17500 17500 63400-Interest expense 10000 10000 10000 64300-Meals and entertainment 800 800 800 64900-office supplies 400 400 400 65000-Payroll expenses 102000 8000 110000 110000 66700-Professional fees 3000 3000 3000 66750-Rent expenses 43300 1000 42300 42300 68400-Travel expenses 17000 17000 17000 68600-Utilities 7500 7500 7500 256500 256500 741250 741250 22000 22000 751250 751250 382750 382750 383000 383000 Notes: 1.Adjusting entries required Sl No. Account titles Debit Credit 1 Dividends paid 2000 Cash 2000 (Additional cash dividend paid) 2 Prepaid rent 1000 Rent expenses 1000 (Rent paid in excess transferred to prepaid rent) 3 Insurance expense (12000-3000) 9000 Prepaid insurance 9000 (Insurance paid in excess transferred to prepaid insurance) 4 Payroll expenses 80000 Payroll payable 8000 (Payroll expenses due) 5 Depreciation expense 2000 Accumulated depreciation 2000 (Depreciation expenses for the year) 2. Closing entries: Sl No. Account titles Debit Credit 1 Income summary 364250 Cost of goods sold 153750 Depreciation expense 2000 Insurance expense 17500 Interest expense 10000 Meals and entertainment 800 Office supplies 400 Payroll expenses 110000 Professional fees 3000 Rent expenses 42300 Travel expenses 17000 Utilities 7500 (Closing of all expense accounts) 2 Sales 378750 Income summary 378750 (Closing of all income accounts) 3 Income summary 14500 Retained earnings 14500 (Balance in income summary to Retained earnings) 4 Retained earnings 4000 Dividend paid 4000 (Dividen paid closed)

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