Reference no: EM13970265

At the end of the first three months of operation, Evergreen Repair's trial balance is as follows.

Cash	7,983
Accounts Receivable	5,872
Office Supplies	970
Prepaid Rent	1,500
Equipment	5,200
Accounts Payable			2,629
Unearned Repair Revenue			1,146
J. Kita, Capital			11,314
J. Kita, Withdrawals	1,800
Repair Revenue			12,236
Wages Expense	3,580
Office Cleaning Expense	420
	27,325		27,325

At the end of the first three months of operation,

Jonah Kita, Evergreen's owner, has hired an accountant to prepare financial statements to determine how well the company is doing after three months. Upon examining the accounting records, the accountant finds the following items of interest:

a. An inventory of office supplies reveals supplies on hand of $469.

b. The Prepaid Rent account includes the rent for the first three months plus a deposit for April's rent.

c. Depreciation on the equipment for the first three months is $560.

d. The balance of the Unearned Repair Revenue account represents a 12-month service contract paid in advance on February 1.

e. On March 31, accrued wages total $168.

REQUIRED

All adjustments affect one balance sheet account and one income statement account. For each of these situations, show the accounts affected, the amount of the adjustment (using a 1 or 2 to indicate an increase or decrease), and the balance of the account after the adjustment in the following format: