Last Chance Company offers legal consulting advice to prison inmates. Last Chance Company prepared the end-of-period spreadsheet

Last Chance Company offers legal consulting advice to prison inmates. Last Chance Company prepared the end-of-period spreadsheet shown at the top of the following page at June 30, 2019, the end of the fiscal year.

Instructions

1. Prepare an income statement for the year ended June 30.

2. Prepare a statement of owner’s equity for the year ended June 30. No additional investments were made during the year.

3. Prepare a balance sheet as of June 30.

4. On the basis of the end-of-period spreadsheet, journalize the closing entries.

5. Prepare a post-closing trial balance.

A B C D E F G 1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9

201 2 3 4 5 6 7 8 9 30

Last Chance Company End-of-Period Spreadsheet For the Year Ended June 30, 2019 Unadjusted Adjustments Trial Balance Trial Balance Account Title Dr. Cr. Dr. Cr. Dr. Cr. Adjusted 5,100 22,750 3,600 2,025 80,000 340,000 140,000 20,000 145,100 86,800 30,000 18,750 5,875 900,000 190,000 54,450 9,750 4,500 361,300 280,000 900,000 (a) 3,750 (g) 3,000 ( f )  1,900 (e) 4,550 (d) 3,000 (c) 1,500 (b) 1,300 19,000 (b) 1,300 (c) 1,500 (d) 3,000 (e) 4,550 (f)   1,900 (a) 3,750 (g) 3,000  19,000 5,100 26,500 2,300 525 80,000 340,000 140,000 20,000 147,000 86,800 30,000 18,750 4,550 3,000 1,500 1,300 5,875 913,200 193,000 59,000 9,750 1,900 1,500 361,300 283,750 3,000 913,200

Answer:

1.

Revenues:

Fees earned$283,750

Rent revenue3,000

Total revenues$286,750

Expenses:

Salaries and wages expense $147,000

Advertising expense86,800

Utilities expense30,000

Travel expense18,750

Depreciation expense—equipment 4,550

Depreciation expense—building 3,000

Supplies expense1,500

Insurance expense1,300

Miscellaneous expense5,875

Total expenses298,775

Net loss$ (12,025)

2.

Tami Garrigan, capital, July 1, 2018$361,300

Net loss for the year$(12,025)

Withdrawals(20,000)

Decrease in owner’s equity(32,025)

Tami Garrigan, capital, June 30, 2019$329,275

3.

Current assets:

Cash$ 5,100

Accounts receivable26,500

Prepaid insurance2,300

Supplies525

Total current assets$ 34,425

Property, plant, and equipment:

Land$ 80,000

Building$340,000

Less accumulated depreciation 193,000 147,000

Equipment$140,000

Less accumulated depreciation 59,000 81,000

Total property, plant, and equipment308,000

Total assets$342,425

Current liabilities:

Accounts payable$ 9,750

Salaries and wages payable1,900

Unearned rent1,500

Total liabilities$ 13,150

Tami Garrigan, capital329,275

Total liabilities and owner’s equity$342,425

4.  2019

 June 30 Fees Earned283,750

Rent Revenue3,000

Tami Garrigan, Capital(12,025)

Salaries and Wages Expense147,000

Advertising Expense86,800

Utilities Expense30,000

Travel Expense18,750

Depreciation Expense—Equipment 4,550

Depreciation Expense—Building 3,000

Supplies Expense1,500

Insurance Expense1,300

Miscellaneous Expense5,875

30 Tami Garrigan, Capital 20,000

Tami Garrigan, Drawing20,000

5.

Debit Credit

Balances Balances

Cash5,100

Accounts Receivable26,500

Prepaid Insurance2,300

Supplies525

Land80,000

Building340,000

Accumulated Depreciation—Building193,000

Equipment140,000

Accumulated Depreciation—Equipment59,000

Accounts Payable9,750

Salaries and Wages Payable1,900

Unearned Rent1,500

Tami Garrigan, Capital329,275

594,425 594,425