Prepare the necessary year-end closing entries (Hint: adjusting entries need to be done before preparing the year-end closing entries) and prepare an after-closing trial balance at 31 December 2019.
Question 4 (22 marks)
Temple Gum Corporation Unadjusted Trial Balance At 31 December 2019
Debit: $14,950, $35,300, $1,200, $375, $900, $15,000
Credit: $12,000, $1,500, $6,000, $3,200, $8,000, $20,000, $10,800, $800, $46,500, $480, $1,130, $2,750, $6,100, $1,175, $24,640, $3,200, $108,000
Other information:
1) Office equipment is being depreciated over 60 months.
2) At 31 December 2019, $2,500 of previously unearned agency fees had been earned.
3) Accrued but unrecorded and unpaid salary expense totals $1,360 at 31 December 2019.
4) The corporation pays rent quarterly (every three months). The most recent advance payment of $1,800 was made on 1 November 2019. The next payment of $1,800 will be made on 1 February 2020.
5) Accrued but unrecorded and uncollected agency fees earned total $3,000 at 31 December 2019.
6) Office supplies on hand at 31 December 2019, total $530.
7) On 1 September 2019, the corporation purchased a six-month insurance policy for $750.
8) On 1 December 2019, the corporation borrowed $6,000 by signing a three-month, 9 percent note payable. The entire amount borrowed, plus interest, is due 1 March 2020.
9) Accrued income taxes payable for the entire year ending 31 December 2019, total $3,900. The full amount is due early in 2020.
