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Presented below are the trial balance and the other information related to Gator Consulting GATOR CONSULTING TRIAL BALANCE DECEMBER 31 2020 Debit Credit Cash $21600 Accounts Receivable

Presented below are the trial balance and the other information related to Gator Consulting.

 

GATOR CONSULTING

 

TRIAL BALANCE

 

DECEMBER 31, 2020

 

 

 

 

Debit

Credit

 

Cash

 

 

$21,600

 

 

Accounts Receivable

 

85,600

 

 

Allowance for Doubtful Accounts

 

$1,600

 

Supplies

 

 

12,600

 

 

Prepaid Insurance

 

 

2,800

 

 

Equipment

 

 

43,000

 

 

Accumulated Depreciation—Equipment

10,750

 

Notes Payable

 

 

 

50,000

 

Owner’s Capital

 

 

 

18,250

 

Service Revenue

 

 

 

427,500

 

Rent Expense

 

 

42,000

 

 

Salaries and Wages Expense

 

256,800

 

 

Utilities Expense

 

 

16,800

 

 

Office Expense

 

 

26,900

 

 

 

 

 

$508,100

$508,100

 

 

 

 

 

 

 

                 

 

1. Fees received in advance from clients and included in Service Revenue initially, $9,000.

2. Services performed for clients that were not recorded by December 31, $12,600.

3. Bad debt expense for the year is $3,650.

4. Insurance expired during the year $2,100.

5. Equipment is being depreciated at 10% per year.

6. Gator gave the bank a 90-day, 12% note for $50,000 on December 1, 2020.

7. Rent of the building is $3,000 per month. The rent for 2020 has been paid, as has that for January and February 2021. The total rental payment was initially recorded in Rent Expense.

8. Office salaries and wages earned but unpaid December 31, 2020, $2,650

Instructions

(a) From the trial balance and other information given, prepare annual adjusting entries as of December 31, 2020. (Omit explanations.)

(b) Prepare an income statement for 2020, a statement of owner’s equity, and a classified balance sheet. The owner withdrew $25,000 cash for personal use during the year.

Jul 14 2020 Read more Less More

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