Reference no: EM132924072
Question - Use the unadjusted trial balance of Electric Bike on December 31, 2020.
Debit Credit
Cash $8,300
Accounts receivable 22,865
Merchandise inventory 34,800
Store supplies 2,515
Office supplies 795
Prepaid insurance 3,455
Equipment 76,690
Accumulated depreciation, equipment $13,855
Accounts payable 8,200
Salaries payable 0
Braeden Li, capital 172,465
Braeden Li, withdrawals 63,000
Interest income 330
Sales 530,000
Sales returns and allowances 5,270
Cost of goods sold 381,360
Salaries expense 96,500
Rent expense 29,300
Supplies expense 0
Depreciation expense, equipment 0
Insurance expense 0
Totals $724,850 $724,850
Required -
1. Record adjusting entries for the following information.
a. The records show that the equipment was estimated to have a total estimated useful life of 10 years with a residual value at the end of its life of $14,690.
b. The balance in the Prepaid Insurance account was reviewed and it was determined that $265 was unused at December 31, 2020.
c. A review of the store supplies on December 31, 2020, revealed a balance on hand of $2,060; a similar examination of the office supplies showed that $650 had been used.
d. Accrued salaries payable, $1,900.
e. A count of the merchandise inventory revealed a balance on hand December 31, 2020, of $33,980.
2. Make a multiple-step income statement showing the expenses in detail.