Accounting Homework

Review the unadjusted trial balance below and prepare adjusting journal entries to record the various described items
below. Record in the space provided at the bottom of this spreadsheet. After completing journal entries, complete the
adjusted trial balance below. Lastly complete the income statement, balance sheet and statement of retained earnings.
The balance sheet must balance. The accounting equation is Assets = Liabilities + Equity.

Baltimore Corporation
Unadjusted Trial Balance
January 31, 2016

Debits Credits
Cash $37,500 $-
Accounts receivable 12,410 –
Prepaid insurance 2,400 –
Supplies inventory 7,113 –
Equipment 35,000 –
Accumulated depreciation – 10,000
Accounts payable – 7,569
Salaries payable – –
Interest payable – –
Unearned revenue – 8,500
Loan payable – 11,500
Capital stock – 25,000
Retained earnings, Jan. 1 – 15,457
Revenues – 43,995
Depreciation expense – –
Interest expense – –
Insurance expense – –
Office expense 2,500 –
Rent expense 13,000 –
Salary expense 12,098 –
Supplies expense – –
Utilities expense – –
$122,021 $122,021

1 “Belair Corporation’s equipment had an original life of 140 months, and the straight-line depreciation method is used.
”
“As of January 1, the equipment was 40 months old. The equipment will be worthless at the end of its useful life.
”

2 “As of the end of the month, Belair Corporation has provided services to customers for which the earnings process is complete.

”
“Formal billings are normally sent out on the first day of each month for the prior month’s work. January’s unbilled work is $25,000.

”

3 “Utilities used during January, for which bills will soon be forthcoming from providers, are estimated at $1,500.

”

4 “A review of supplies on hand at the end of the month revealed items costing $3,500.
”

5 “The $2,400 balance in prepaid insurance was for a 6-month policy running from January 1 to June 30.

”

6 “The unearned revenue was collected in December of 2014. 60% of that amount was actually earned in January, with the remainder to be earned in February.
”

7 “The loan accrues interest at 1% per month. No interest was paid in January.
”

8 At month end, salaries of $2,120 have been earned but not paid.

JE # ACCOUNT DEBIT CREDIT
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Baltimore Corporation
Adjusted Trial Balance
January 31, 2016

Debits Credits
Cash
Accounts receivable
Prepaid insurance
Supplies inventory
Equipment
Accumulated depreciation
Accounts payable
Salaries payable
Interest payable
Unearned revenue
Loan payable
Capital stock
Retained earnings, Jan. 1
Revenues
Depreciation expense
Insurance expense
Interest expense
Office expense
Rent expense
Salary expense
Supplies expense
Utilities expense
$- $-

Baltimore Corporation
Income Statement
For the month ended January 31, 2016

Baltimore Corporation
Balance Sheet
January 31, 2016
Baltimore Corporation
Statement of Retained Earnings
As of January 31, 2015