Adjusting the Accounts

1. The $3,700 balance in Supplies Expense represents supplies purchased in January. At June 30, $1,500 of supplies are on had.
2. The note payable was issued on February 1. It is a 9%, 6-month note.
3. The balance in Insurance Expense is the premium on a one-year policy, dated March 1, 2019.
4. Service revenues are credited to revenue when received. At June 30, services revenue of $1,300 are unearned.
5. Revenue for services performed but unrecorded at June 30 totals $2,000.
6. Depreciation is $2,250 per year.

Instructions

1. Journalize the adjusting entries at June 30. (Assume adjustments are recorded every 6 months.)
2. Prepare an adjusted trial balance.
3. Prepare an income statement and an owner’s equity statement for the 6 months ended June 30 and a balance sheet at June 30.

Answer