Student Name:
Class:
Entry Debit Credit
1. 3,000
3,000 <–Correct!
2. 25,000
25,000 <–Correct!
Instructor
Problem 03-04
McGraw-Hill
Adjusting Entries
Buzzard Bicycle
(Record salaries owed at December 31)
Salaries Payable
Salaries Expense
(Reduce prepaid insurance for six months used of 36 months paid in advance)
Prepaid Insurance
Insurance Expense
Account
(Record ten months interest expense not yet paid)
Interest Expense
(Reduce prepaid advertising for one month used of four months prepaid)
Advertising Expense
(Supplies used during year)
Supplies
Supplies Expense
(Reduce deferred revenue for completion of four custom bikes of six
Service Revenue
Deferred Revenue
custom bikes paid for in advance)
1. 18,000$
2. 25,000$
Given Data P03-04:
BUZZARD BICYCLE
December 31
Debited Prepaid Insurance for the entire amount.
Purchased 3-year fire insurance policy on July 1.
Financial information:
Employee salaries for December, to be paid in January.
amount credited to Deferred Revenue. Four bikes
Annual rate of interest due each March 1
Received cash for 6 custom bikes on November 1. Entire
Supplies at beginning of year.
Paid for four months of advertising on December 1.
Borrowed cash on March 1.
Principal due.
completed by December 31.
Supplies remaining at end of year.
Supplies purchased during year. Debited to Supplies.
Entire amount debited to Prepaid Advertising. Ads will
Student Name:
Class:
450,000$
280,000
730,000$
Correct!
Total
Common Retained Stockholders’
Stock Earnings Equity
Issuance of common stock
Less: Dividends
Add: Net income for 2021
170,000$ 31,000$ 201,000$
Accounts receivable
Supplies
Prepaid insurance
Notes payable
Total current assets
Equipment
Accumulated Depreciation
Total current liabilities
Utilities payable
Salaries payable
Current Assets
16,000$ 31,000$
For the year ended December 31, 2021
Income Statement
BOILERMAKER UNLIMITED
For the year ended December 31, 2021
Statement of Stockholders’ Equity
BOILERMAKER UNLIMITED
Service revenues:
New Construction
Remodel
Balance at January 1
Assets
Cash
Current Liabilities
Total revenues
Expenses:
BOILERMAKER UNLIMITED
December 31, 2021
Balance Sheet
Problem 03-05
McGraw-Hill
Instructor
Liabilities
Accounts payable
Interest
Service fee
Salaries
Supplies
Depreciation
Insurance
Utilities
Total expenses
200,000
91,000
Retained Earnings
Common Stock
Total liabilities and
Total stockholders’ equity
Debits Credits
16,000$
Depreciation Expense
Insurance Expense
Salaries Expense
Utilities Expense
Interest Expense
Service Fee Expense
Supplies Expense
25,000
200,000
31,000
26,000
450,000
280,000
30,000$
BOILERMAKER UNLIMITED
December 31, 2021
Adjusted Trial Balance
Given Data P03-05:
Accounts Receivable
Cash
Accounts
Retained Earnings
Service Revenue-remodeling
Dividends
Additional information:
Common stock issued during year
Common Stock
Service Revenue-new construction
Supplies
Prepaid Insurance
Equipment
Accumulated Depreciation
Accounts Payable
Salaries Payable
Utilities Payable
Notes Payable (due in 5 years)
Student Name:
Class:
10,300 9,500 2,000
1,300
10,300 9,500 700
Correct! Correct! Correct!
– 5,300 79,000
200 3,300
200 2,000 79,000
Correct! Correct! Correct!
24,500 2,400 –
Instructor
Problem 03-07
McGraw-Hill
Requirement 1 and 2:
Utilities Payable
Deferred Revenue
Common Stock
T-Accounts
CRIMSON TIDE MUSIC ACADEMY
Cash
Accounts Receivable
Supplies
20,000 7,700 2,100
Accounts Payable
Student Name:
Class:
Instructor
Problem 03-07
McGraw-Hill
2,100 200 5,400
26,600 2,600 5,400
Correct! Correct! Correct!
Student Name:
Class:
Instructor
Problem 03-07
McGraw-Hill
Debit Credit
10,300$
9,500
800
700
Rent
Supplies
Utilities
Total expenses
Salaries
45,500$
800
46,300
December 31, 2021
CRIMSON TIDE MUSIC ACADEMY
Requirement 3:
Requirement 4:
CRIMSON TIDE MUSIC ACADEMY
Adjusted Trial Balance
Accounts Receivable
Cash
Account Title
Supplies
For the year ended December 31, 2021
Income Statement
Service
Interest
Interest Receivable
Revenues:
Total revenues
Salaries Expense
Rent Expense
Supplies Expense
Retained Earnings
Service Revenue
Salaries Payable
Deferred Revenue
Utilities Expense
Accounts Payable
Prepaid Rent
Utilities Payable
Common Stock
Interest Revenue
Notes Receivable
Student Name:
Class:
Instructor
Problem 03-07
McGraw-Hill
Total
Common Retained Stockholders’
Stock Earnings Equity
79,000$ 19,700$ 98,700$
Supplies
Total Stockholders’ equity
Notes Receivable
Prepaid Rent
Long-term assets:
Total current assets
Utilities Payable
Total current liabilities
10,300$ 7,700$
9,500 2,100
800 2,000
Entry Account Debit Credit
Retained Earnings
(a) 45,500
800
CRIMSON TIDE MUSIC ACADEMY
Closing Entries
Current assets:
For the year ended December 31, 2021
Statement of Stockholders’ Equity
CRIMSON TIDE MUSIC ACADEMY
Balance at January 1
December 31, 2021
Balance Sheet
CRIMSON TIDE MUSIC ACADEMY
Current liabilities:
Cash
Accounts Receivable
Interest Receivable
Requirement 5:
December 31, 2021
Interest Revenue
Service Revenue
Assets
Liabilities
Accounts Payable
Salaries Payable
Deferred Revenue
Issuance of common Stock
Add: Net income for 2021
Less: Dividends
Problem 03-07
Student Name:
Class:
Instructor
Problem 03-07
McGraw-Hill
19,700 42,200 800
35,900 46,300 45,500 3,300 800
30,100 – –
Correct! Correct! Correct!
Debit Credit
Accounts Payable
Salaries Payable
Interest Payable
Utilities Payable
Common Stock
Retained Earnings
Supplies
Notes Receivable
10,300$
9,500
800
December 31, 2021
CRIMSON TIDE MUSIC ACADEMY
Post-Closing Trial Balance
Retained Earnings
Service Revenue
Interest Revenue
Requirement 6:
Accounts Receivable
Cash
Account Title
Interest Receivable
Requirement 7:
Utilities Expense
Debits Credits
10,300$
9,500
–
2,000
7,200
78,000
20,000
–
2,400
153,900$ 153,900$
Year-end Adjusting Entries: Debit Credit
Salaries Expense 2,100
Interest Receivable
Supplies
Prepaid Rent
Land
Notes Receivable
Given Data P03-07:
Cash
Accounts
Accounts Receivable
CRIMSON TIDE MUSIC ACADEMY
Unadjusted Trial Balance
December 31, 2021
Totals
Utilities Expense
Supplies Expense
Interest Revenue
Accounts Payable
Salaries Payable
Deferred Revenue
Utilities Payable
Common Stock
Retained Earnings
Service Revenue
Salaries Expense
Rent Expense