Group 7 AP 4-7 (page 219) Heather Broadwell Jimmy Ha Linda Yin William Quan Brittany Spangler

Austin Co. Unadjusted Trial Balance As of the end of the annual accounting period, December 31, 2007 ACCOUNT TITLESDEBITCREDIT Cash $ 19,600 Accounts Receivable 7,000 Supplies 1,300 Prepaid insurance 900 Equipment 27,000 Accumulated depreciation, equipment 12,000 Other Assets 5,100 Accounts Payable 2,500 Wages Payable Income Taxes Payable Note Payable (2 yrs; 12% interest due ea. Dec. 31) 5,000 Contributed Capital (4,000 shares outstanding) 16,000 Retained Earnings 10,300 Service Revenue 48,000 Remaining expenses (not detailed; excludes income tax) 32,900 Income Tax Expense TOTALS $93,800

#1 Record the 2007 adjusting entries

A)Depreciation expense for 2007, $3,000 B)Insurance expired during 2007, $450 C) Wages earned by employees but not yet paid on December 31,2007, $1,100

D) The supplies count on December 31, 2007, reflected $600 remaining on hand to be used in 2008 E) Income tax expense was $2,950 f) $5,000 Note payable: 2 years; 12% interest due each Dec. 31 $5,000 x 12% = $600

#2 Prepare an income statement and a classified balance sheet for 2007 to include the effects of the preceding five transactions

#3 Record the 2007 closing entry