APPLICATION ASSIGNMENT #5- ACCT305 (Accounting Cycle) Students - For this application assignment, you are going to complete a Worksheet, Income Statement, Statement of Retained Earnings, and Balance Sheet. You are to use the worksheet to prepare the adjusting entries, statement information, closing entries, and post-closing trial balance. Use cell references, formulas, and summation functions where applicable and appropriate. Specific instructions are outlined below. Instructions: 1. 2. KJW has a fiscal year end of June 30. Journalize the following adjusting entries for 6/30/20 in the Journal and then transfer to the worksheet in the appropriate Adjusting Entries column. (provide descriptions of the entries for a complete journal entry) Keep everyting in whole dollars. a) The company estimates uncollectible accounts using the '% of receivables' allowance method. As of June 30th, the company estimates that 4.5% of the accounts receivable balance is uncollectible. (HINT: Be sure to account for what is already in the Allowance account) b) Supplies on hand are determined to be $ 2,750 c) 25% of the Prepaid Insurance balance has expired as of June 30. d) The Prepaid Rent balance represents 6 months of rent expense. Those months include May through October 2020. Adjust accordingly for June 30. e) Depreciation of assets is recognized as follows for the year end: Buildings - $5,500 Equipment - $8,100 f) Invoices for utilities expenses of $1025 have been received related to June. g) Employees working the last 4 business days of June will be paid in July. The daily expense for employee wages is $1,230. (Ignore payroll tax expenses) h) 35% of the unearned revenue has been earned as of June 30. i) The interest rate on the Mortgage Payable is 7.5%. Interest expense was last updated 12/31/19. Update the Adjusted Trial Balance columns in the worksheet. Make sure you carry the correct debit/credit columns across. Use references and formulas to create the adjusted balances. 3. Carry over the applicable balances to the Income Statement and Balance Sheet columns. Remember the difference in debits/credits will be the Net Income - which should be added to the bottom of the worksheet columns for each. 4. Use the other provided blank worksheets to prepare, in proper format, the Income Statement, Statement of Retained Earnings, and classified Balance Sheet for the period ending. Formatting and labeling should be appropriate, consistent, and user-friendly. (USE Spellcheck for each worksheet) Please refer to examples in the book if you question titles and classifications. **Note that $8,000 of the Mortgage Payable is due December 1, 2020. 5. Write up the closing journal entries in the Journal and transfer to the Worksheet. Remember, all temporary accounts are closed during this process. There are four journal entries involved. 6. Carry over the balances, after closing entries, to the Post Closing Trial Balance on the worksheet. Only permanent accounts should have balances. Complete these requirements and rename the application file as directed. Attach the completed file to the assignment link by the due date. CHECK FIGURES: Total debit/credit amount for adjusting journal entries Adjusted Trial Balance debit/credit total Net Income Total Assets on the Balance Sheet 51,135 1,063,945 143,815 706,770 (For general and closing journal entries) *Always provide descriptions for your journal entries General Journal Ref Date Account Titles Debit Credit Account Titles Cash Accounts Receivable Allowance for Doubtful Accounts Supplies Prepaid Insurance Prepaid Rent Land Buildings Accum. Depreciation-Bldgs. Equipment Accum. Depreciation-Equip. Goodwill Patents Accounts Payable Unearned Revenue Interest Payable Salaries and Wages Payable Mortgage Payable Common Stock ($1 par) Paid in Capital in Excess of par-CS Dividends Retained Earnings Income Summary Sales Revenue Supplies Expense Salaries and Wages Expense Maint. and Repairs Expense Advertising Expense Depreciation Expense Bad Debt Expense Utilities Expense Rent Expense Insurance Expense Interest Expense Totals Net Income Totals Trial Balance Db. Cr. 46,500 64,000 Ref 850 14,200 28,000 18,000 72,000 145,000 35,000 110,500 52,000 287,000 49,500 34,650 8,600 56,000 100,000 25,000 10,000 343,670 384,500 1,620 124,800 18,300 8,200 14,950 25,000 2,700 1,040,270 1,040,270 Adjusting Entries Db. KJW Company Adjusting Entries Cr. Ref Worksheet For the Year Ended June 30, 2020 Adjusted Trial Balance Income Statement Db. Cr. Db. Cr. Balance Sheet Db. Balance Sheet Cr. Ref Closing Entries Db. Cr. Ref Post-Closing Trial Balance Db. Cr. 
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