Colton Enterprises experienced the following events for Year 1,the first year of operation: Acquired $45,000 cash from the issueof common stock. Paid $13,000 cash in advance for rent. The paymentwas for the period April 1, Year 1, to March 31, Year 2. Performedservices for customers on account for $92,000. Incurred operatingexpenses on account of $40,000. Collected $70,500 cash fromaccounts receivable. Paid $31,000 cash for salary expense. Paid$32,000 cash as a partial payment on accounts payable. AdjustingEntries Made the adjusting entry for the expired rent. (See Event2.) Recorded $4,400 of accrued salaries at the end of Year 1.Events for Year 2 Paid $4,400 cash for the salaries accrued at theend of the prior accounting period. Performed services for cash of$41,000. Purchased $3,800 of supplies on account. Paid $13,500 cashin advance for rent. The payment was for one year beginning April1, Year 2. Performed services for customers on account for$108,000. Incurred operating expenses on account of $51,500.Collected $99,000 cash from accounts receivable. Paid $49,000 cashas a partial payment on accounts payable. Paid $32,500 cash forsalary expense. Paid a $13,000 cash dividend to stockholders.Adjusting Entries Made the adjusting entry for the expired rent.(Hint: Part of the rent was paid in Year 1.) Recorded suppliesexpense. A physical count showed that $400 of supplies were stillon hand.
b. Post the Year 1 events to T-accounts.
