Last Chance Company offers legal consulting advice to prison inmates. Last Chance Company prepared the end-of-period spreadsheet

Last Chance Company offers legal consulting advice to prison inmates. Last Chance Company prepared the end-of-period spreadsheet at the top of the following page at June 30, 2014, the end of the current fiscal year.

Instructions
1. Prepare an income statement for the year ended June 30.
2. Prepare a statement of owner’s equity for the year ended June 30. No additional investments were made during the year.
3. Prepare a balance sheet as of June 30.
4. On the basis of the end-of-period spreadsheet, journalize the closing entries.
5. Prepare a post-closing trial balance.



Cash
Accounts Receivable
Prepaid Insurance
Supplies
Land
Building
Accum. Depr.—Building
Equipment
Accum. Depr.—Equipment
Accounts Payable
Salaries & Wages Payable
Unearned Rent
Tami Garrigan, Capital
Tami Garrigan, Drawing
Fees Earned
Rent Revenue
Salaries & Wages Expense
Advertising Expense
Utilities Expense
Travel Expense
Depr. Exp.—Equipment
Depr. Exp.—Building
Supplies Expense
Insurance Expense
Misc. Expense
Last Chance Company
End-of-Period Spreadsheet
For the Year Ended June 30, 2014
Unadjusted
Trial Balance Adjustments Trial Balance
Account Title Dr. Cr. Dr. Cr. Dr. Cr.
Adjusted
5,100
22,750
3,600
2,025
80,000
340,000
140,000
20,000
145,100
86,800
30,000
18,750
5,875
900,000
190,000
54,450
9,750
4,500
361,300
280,000
900,000
(a) 3,750
(g) 3,000
(f) 1,900
(e) 4,550
(d) 3,000
(c) 1,500
(b) 1,300
 19,000
(b) 1,300
(c) 1,500
(d) 3,000
(e) 4,550
(f) 1,900
(a) 3,750
(g) 3,000
 19,000
5,100
26,500
2,300
525
80,000
340,000
140,000
20,000
147,000
86,800
30,000
18,750
4,550
3,000
1,500
1,300
5,875
913,200
193,000
59,000
9,750
1,900
1,500
361,300
283,750
3,000
913,200



Answer:



1.
 LAST CHANCE COMPANY
Income Statement
For the Year Ended June 30, 2014
Revenues:
Fees earned $283,750
Rent revenue 3,000
Total revenues $286,750
Expenses:
Salaries and wages expense $147,000
Advertising expense 86,800
Utilities expense 30,000
Travel expense 18,750
Depreciation expense—equipment 4,550
Depreciation expense—building 3,000
Supplies expense 1,500
Insurance expense 1,300
Miscellaneous expense 5,875
Total expenses 298,775
Net loss $ 12,025
2.
 LAST CHANCE COMPANY
Statement of Owner’s Equity
For the Year Ended June 30, 2014
Tami Garrigan, capital, July 1, 2013 $361,300
Net loss for the year $12,025
Add withdrawals 20,000
Decrease in owner’s equity 32,025
Tami Garrigan, capital, June 30, 2014 $329,275
3.
 LAST CHANCE COMPANY
Balance Sheet
June 30, 2014
Assets Liabilities
Current assets: Current liabilities:
Cash $ 5,100 Accounts payable $9,750
Accounts receivable 26,500 Salaries and wages payable 1,900
Prepaid insurance 2,300 Unearned rent 1,500
Supplies 525 Total liabilities $ 13,150
Total current assets $ 34,425
Property, plant, and equipment:
Land $ 80,000
Building $340,000 Owner’s Equity
Less accum. depreciation 193,000 147,000 Tami Garrigan, capital 329,275
Equipment $140,000
Less accum. depreciation 59,000 81,000
Total property, plant, and
equipment 308,000 Total liabilities and owner’s
Total assets $342,425 equity $342,425
2014
June 30 Fees Earned 283,750
Rent Revenue 3,000
Income Summary 286,750
30 Income Summary 298,775
Salaries and Wages Expense 147,000
Advertising Expense 86,800
Utilities Expense 30,000
Travel Expense 18,750
Depreciation Expense—Equipment 4,550
Depreciation Expense—Building 3,000
Supplies Expense 1,500
Insurance Expense 1,300
Miscellaneous Expense 5,875
30 Tami Garrigan, Capital 12,025
Income Summary 12,025
30 Tami Garrigan, Capital 20,000
Tami Garrigan, Drawing 20,000
LAST CHANCE COMPANY
Post-Closing Trial Balance
June 30, 2014
Debit
Balances
Credit
Balances
Cash 5,100
Accounts Receivable 26,500
Prepaid Insurance 2,300
Supplies 525
Land 80,000
Building 340,000
Accumulated Depreciation—Building 193,000
Equipment 140,000
Accumulated Depreciation—Equipment 59,000
Accounts Payable 9,750
Salaries and Wages Payable 1,900
Unearned Rent 1,500
Tami Garrigan, Capital 329,275
594,425 594,425