Chapter 3 - Analyze adjusted data.
Hank's Hotel opened for business on May 1, 2022. Its trial
balance before adjustment on May 31 is as follows
Account number
101 Cash
126 Supplies
130 Prepaid Insurance
140 Land
141 Buildings
149 Equipment
200 Notes Payable
201 Accounts Payable
208 Unearned Rent Revenue
301 Owner's Capital
429 Rent Revenue
610 Advertising Expense
726 Salaries and Wages Expense
732 Utilities Expense
Hank's Hotel
Trial Balance
31-May-22
Debit
Credit
$3,400
$2,080
$2,400
$12,000
$60,000
$15,000
$40,000
$4,700
$3,300
$41,380
$10,300
$600
$3,300
$900
$99.680
$99,680
In addition to those accounts listed on the trial balance, the chart of accounts for Hank's Hotel also contains the following accounts and account
numbers: No. 142 Accumulated Depreciation-Buildings, No. 150 Accumulated Depreciation-Equipment, No. 212 Salaries and Wages Payable,
No. 230 Interest Payable, No. 619 Depreciation Expense, No. 631 Supplies Expense, No. 718 Interest Expense, and No. 722 Insurance Expense
Other data:
(1) Prepaid insurance is a 1year policy starting May 1, 2022.
(2) Account of supplies shows $750 of unused supplies on May 31
(3) Annual depreciation is $3,600 on the buildings and $1,500 on equipment.
(4) The note payable interest rate is 6%. (The note was taken out on May 1 and will be repaid along with
interest in 1 year.)
(5) Twothirds of the unearned rent revenue has been earned.
(6) Salaries and wages of $750 are unpaid and unrecorded at May 31.
Instructions:
(a) Journalize the adjusting entries on May 31.
(b) Prepare a ledger using the threecolumn form of account. Enter the trial balance amounts and post
the adjusting entries.
(Use J1 as the posting reference.)
(c) Prepare an adjusted trial balance on May 31.
(d) Prepare an income statement and an owner's equity statement for the month of May and a balance sheet at May 31
