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Refer to the Chapter 3 takehome quiz involving Modern Communications, Inc. As part of the Chapter 3 assignment you recorded all August transactions. The following additional information is provided at August 31, 2017
1) Insurance coverageexpires on October 31, 2017.
2) Depreciation expense for the month was $3,750.
3) Gift cards with remaining balances of $2,300 expired on August 31, 2017.
4) A physical count showed $23,000 on supplies on hand at 8/31/17.
5) $3,500 of wages earned from August 27-31 will be paid in September.
6) The interestrate on the $35,000 note payable is 6%.
7) Received an August phone bill for $250 on September 4.
8) The investment balance includes a $15,000 certificate of deposit with an interest rate of
2%.
9) The lease agreement requires an additional monthly payment equal to 1% of
service revenue. The payment will be made in September.
10) The income tax rate is 40%
Required:
a. Use Excel to create an unadjusted trial balance for Modern Communications, Inc from
the Chapter 3 take-home quiz at August 31, 2017.
b. Post all adjusting journal entries necessary on August 31, 2017 to your Excel trial
balance. Create additional accounts as necessary.
c. Use Excel to create the adjusted trial balance.
d. Prepare the closing entry at August 31, 2017
.
Chapter 3 Take Home Quiz The following account balances are provided for Modern Communications, Inc. at July 31, 2017 Balance Accounts receivable Interest receivable Investments Spare parts and supplies Prepaid insurance Equipment (net) Accounts payable Interest payable Salaries payable Unearned revenue Bank loan due October 1, 2018 Common stock (no par) Retained earnings $ 250,000 170,000 150 38,000 40,000 36,000 486,850 84,000 300 36,000 40,000 426,000 350,000 84,700
Expert Answer
