UNIT 3: TUTORIAL WORKSHEET (SESSION 1)

QUESTION 1:
Suppose you have been given a job as an Accounting Clerk in a retail store and have been asked by the manager for advice o
pay immediately for services rendered while a few pay sometime later. As at December 31st, 2013 the company collected $
services rendered within the same period. Advice the manager how much should be recorded as service revenue under the

Income Statement
for the year ended Dec 31st, 2013
(CASH BASIS)

$ $
Revenue 30,000

Expenses -25,000
Net profit 5,000

Income Statement
for the year ended Dec 31st, 2013
(ACCRUAL BASIS)
$ $
Revenue 30,000

Expenses 25,000
Net Profit 55,000

QUESTION 2:
Complete the missing information in the various columns of the worksheet below:

UNADJUSTED TRIAL ADJUSTMENT ADJUSTED TRIAL

BALANCE BALANCE
ACCOUNT TITLE DEBIT CREDIT DEBIT CREDIT DEBIT CREDIT
Cash 2,065 2,065
Accounts Receivable 2,220 500 2,720
Supplies 2,000 1,240 760
Furniture 14,200 14,200
Prepaid Insurance 985 100 885
Accounts Payable 1,260 1,260
Salary Payable 4,000 4,000
Owner, Capital 11,000 11,000
Owner, withdrawal 2,000 2,000
Service Revenue 14,340 14,340
Salary Expense 8,275 8,275
Supplies Expense 1,600 1,240 2,840
Insurance Expense 800 100 900
Utilities Expense 455 455
Suspense 500
32,600 32,600 33,100 33,100
Accumulated- Dep: 360
Furniture
Depreciation Expense 360 360
2,200 1,240 33,460 33,460
 d by the manager for advice on an accounting issue. You were told that most of the companies customers
2013 the company collected $30,000 from its cash customers, while $25,000 is owed by other customers for
as service revenue under the cash basis and accrual basis of accounting for the period in question.
QUESTION 3:

Blum Services has the following unadjusted balances at year-end

$
Cash 12,900
Prepaid Insurance 2,000
Office Supplies 1,300
Office Equipment 10,500
Accumulated Depreciation: 3,500
Office Equipment
Accounts Payable 2,900
Salary Payable 0
Unearned Service Revenue 4,500
A.L.Blum, Capital 11,750
A.L.Blum, drawing 5,600
Service Revenue 13,350
Salary Expense 3,700
Depreciation Expense 0
Supplies Expense 0
Insurance Expense 0

The following information is available to use in making adjusting entries.

a. Office supplies on hand at year-end: $250
b. Prepaid insurance expired during the year: $325
c. Unearned revenue remaining at year-end: $2,500
d. Depreciation expense for the year: $1,800
e. Accrued salaries at year-end: $900

From the above information prepare the adjusted trial balance for the company (NB. Worksheet must include unadjusted tr

UNADJUSTED TRIAL ADJUSTMENTS ADJUSTED TRIAL

BALANCE BALANCE
ACCOUNTS DEBIT CREDIT DEBIT CREDIT DEBIT
Cash 12,900 12,900
Prepaid Insurance 2,000 1,675 325
Office Supplies 1,300 1,050 250
Office Equipment 10,500 10,500
Acc. Dep: Office Equipment 3,500
Accounts Payable 2,900
Salary Payable 0 900
Unearned Service Revenue 4,500 2,000
A.L.Blum, capital 11,750
A.L.Blum, drawings 5,600 5,600
Service Revenue 13,350
Salary Expense 3,700 3,700
Depreciation Expense 0 1,800 1,800
Supplies Expense 0
Insurance Expense 0
36,000 36,000 35,075
et must include unadjusted trial balance, adjustments, and the adjusted trial balance.)

ADJUSTED TRIAL

CREDIT

3,500
2,900
900
2,500
11,750

13,350

34,900
QUESTION 4:

Prepare an income statement, balance sheet and statement of owner’s equity for the year ended December 31, 2012 from t

Deavours Photography
Adjusted Trial Balance
December 31, 2012

ACCOUNTS DEBIT ($) CREDIT ($)

Cash 2,000
Prepaid Insurance 2,000
Office Supplies 600
Office Equipment 16,000
Accumulated Depreciation 3,000
Accounts Payable 5,000
Salaries Payable 900
Unlearned Service Revenue 2,500
C. Devours, capital 7,450
C. Devours, drawings 5,600
Service Revenue 15,350
Salaries Expense 4,600
Depreciation Expense 1,000
Supplies Expense 400
Insurance Expense 2,000
Totals 34,200 34,200

Devours Photography
Income Statement
for the year ended Dec 31, 2012

$ $
Revenue 15,350
Less Expenses:
Salaries Expense 4,600
Depreciation Expense 1,000
Supplies Expense 400
Insurance Expense 2,000 -8,000
Net Profit 7,350

Devours Photography
Balance Sheet
 as at Dec 31, 2012
$ $ $
Fixed assets:
Office Equipment 16,000 -3,000 13,000
Current Assets:
Cash 2,000
Prepaid Insurance 2,000
Office Supplies 600 4,600
Net Assets 17,600

Current Liabilities:
Accounts Payable 5,000
Salaries Payable 900
Unearned Service Revenue 2,500 8,400

Capital 7,450
Drawings -5,600
Net Income 7,350 9,200
Net Assets 17,600

Devours Photography
Statement of Owner's Equity
as at Dec 31, 2012

$
Owner's Capital at Dec 01.2012 7,450
Add: Net Profit 7,350
14,800
Less: Drawings -5,600
Owner's Capital at Dec 31. 2012 9,200
ed December 31, 2012 from the following adjusted trial balance:
QUESTION 5:

Selected accounts of Noteworthy Communications at December 31, 20X6, follow:

Accounts payable $15,100
Accounts receivable 6,600
Accumulated depreciation - equipment 37,800
Accumulated depreciation- computers 11,600
Equipment 114,400
Cash 16,500
Service revenue 93,500
Computers 22,700
Interest payable 600
Lori Stone, capital $67,100
Note payable, long-term 27,800
Other assets 3,600
Other current liabilities 4,700
Prepaid insurance 1,100
Prepaid rent 6,600
Salary expense 24,600
Salary payable 3,900
Supplies 2,500
Unearned service revenue 5,400

Required: i) Prepare Noteworthy’s classified balance sheet in report form as at December 31, 20X6. Show totals for total ass

Noteworthy
Balance Sheet
as at Dec 31, 20x6

$ $ $
Fixed Assets:
Equipment 114,400 -37,800 76,600
Computers 22,700 -11,600 11,100
87,700
Current Assets:
Cash 16,500
Account Receivable 6,600
Prepaid Insurance 1,100
Prepaid Rent 6,600
Supplies 2,500
Other assets 3,600 36,900
Net Assets 124,600

Current Liabilities:
Accounts Payable 15,100
Interest Payable 600
Salary Payable 3,900
Unearned Service revenue 5,400 25,000

Long-term Liabilities
Notes Payable 27,800
Capital 67,100 94,900

Net Profit 0
Other Liabilities 4,700 4,700
Net Assets 124,600
20X6. Show totals for total assets, total liabilities and owner’s equity.
QUESTION 6:

Lane's Interior Trial Balance

UNADJUSTED TRIAL ADJUSTMENTS ADJUSTED TRIAL

BALANCE BALANCE
DEBIT CREDIT DEBIT CREDIT DEBIT
Cash 4,300 4,300
Note Receivable 10,300 10,300
Interest Receivable 0
Supplies 500 100 400
Prepaid Insurance 1,700 300 1,400
Furniture 27,400 27,400
Acc. Dep: Furniture 1,400 500
Building 53,900 53,900
Acc. Dep: Building 34,500 400
Land 18,700 18,700
Accounts Payable 14,700 100
Interest Payable 0
Salaries Payable 0
Unearned Service Revenue 8,800 4,400
Note Payable - Long term 18,700
K.Lane, capital 29,900
K. Lane, drawings 3,800 3,800
Service Revenue 16,800
Interest Revenue 200
Salary Expense 2,100 600 1,500
Insurance Expense 0
Interest Expense 200
Utilities Expense 1,100 1,100
Advertising Expense 1,000 100 1,100
Supplies Expense 0
Dep Expense - Furniture 0
Dep Expenses- Building 0
Total 124,800 124,800 123,900
ADJUSTED TRIAL

CREDIT

1,900

34,900

14,800

4,400
18,700
29,900

16,800
200

200

121,800