December 31, unadjusted trial balance for demon deacons corp.
accounts debit credit
cash $10,000
accounts receivable 15,000
prepaid rent 7,200
supplies 4,000
deferred revenue $3,000
common stock 11,000
retained earnings 6,000
service revenue 51,200
salaries expense 35,000
totals $71,200 $71,200
a) the balance of prepaid rent, $7,200, represents payment on oct 31, 2018 for rent from nov 1, 2018-april 30, 2019.
b) deferred revenue, $3,000, represents payment in advance from customer. by the end of the year $750 of the services have been provided.
c) an additional $700 in salaries owed to employees at the end of the year but will not be paid until jan 4, 2019.
d) the balance of supplies, $4,000, represents the amount of office supplies on hand at the beginning of the year of $1,700 plus and additional $2,300 purchased throughout 2018. by the end of 2018, only $800 of supplies remains.
1. update account balances by recording adjusting entries.
2. prepare adjusted trial balance.