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On September 30th 2019, Beres Corp. prepares to wrap up their accounting cycle for their first month of operations. Up to this point, Beres has completed the first four steps of their accounting cycle (i.e., identified accounting transactions to record during the month, journalized transactions, posted transactions, and prepared an unadjusted trial balance as seen above). The next stepthe adjustment processrequires consideration of the following information:

1. The amount borrowed from the bank is due back on September 1 , 2023. The bank charges 6% annual interest and the first interest payment is scheduled for December 31 , 2019.

2. The service vehicles are expected to be used in operations for 5 years with a salvage value of $60,000 at the end of their useful lives.

3. At the end of the month, Beres counts $5,000 of unused supplies.

4. The income tax rate for September income is 25%.

Instructions: Complete the accounting cycle for Beres Corp. by doing the following:

1. a) Journalize and post all necessary adjusting entries. For items #1 and #2 above, round the adjustment period up to a full month (e.g., record depreciation as if the vehicles were purchased on September 1stthis makes the math cleaner by avoiding fractions of a month).

2. b) Prepare an adjusted trial balance.

3. c) Prepare an income statement and retained earnings statement for the month of September and a balance sheet at September 30 , 2019.

4. d) Journalize and post all necessary closing entries.

5. e) Prepare a post-closing trial balance.

Beres Corporation General Journal (Amounts in $000) Note: Explanations Omitted. CR Date 9/1/19 1 3,000 3,000 2 9/2/19 2,000 2,000 3 9/3/19 9/4/19 4 300 300 5 9/5/19 3 3 12 6 9/6/19 12 7 9/7/19 400 Account Titles DR Cash Common Stock Cash Loan Payable N/A Cash Service Vehicles Cash Fuel Expense Supplies Accounts Payable Cash Accounts Receivable Retained Earnings Revenue Cash Accounts receivable Cash Dividends Cash Unearned Revenue Cash Prepaid Ads. Cash Salaries Payable Expense 800 1200 8 9/10/19 800 800 50 9 9/15/19 50 250 10 9/20/19 250 11 9/25/19 60 60 12 9/30/19 450 150 600 $ 8,275.00 $ 8,275.00 Beres Corporation Trial Balance (Amounts in $000) 30-Sep-19 DR CR $5,587 $3,000 2000 300 3 12 Account Cash Common Stock Loan Payable Service Vehicles Fuel Expense Supplies Accounts Payable Accounts Receivable Retained Earnings Rev Dividends Unearned Revenue Prepaid Ads Salaries Payable Expense 12 0 1200 50 250 60 150 600 6612 6612 Transaction Analysis Beres Corporation Expanded Accounting Equation (Amounts in $000) Assets Service Cash + Vehicles + Supplies + II + Accounts Liabilities Loan Payable + Prepaid Advertising Unearned Accounts Payable + Salaries Payable Event Receivable Revenue + + 1 = + 2 2,000 + 3,000 2,000 No accounting transaction -300 3 = + 4 300 = + 5 -3 = + 6 12 = 12 + 7 400 = + 800 -800 8 = + 9 = + 10 800 -50 250 -60 -450 250 + 60 + 11 12 150 + + Stockholders' Equity Common Stock + Retained Earnings Revenue - Expense - Dividends + + 3,000 + + + -3 Fuel Expense + + 1,200 Service Revenue + + -50 + + + -600 Salaries Expense Cash Common Stoc! Accounts Payable Dividends 3000 12 50 3000 2000 300 3 400 800 50 3000 12 50 250 60 450 Unearned Revenue Service Vehicles 3001 Accounts Receivable 800 5587 250 800 Loan Payable 300 0 250 2000 2000 Supplies 12 Retained Earnings Revenue 1200 Prepaid Ads Expense 60 12 1200 Fuel Expense 3 60 3 Salaries Payable 150 150 Expense 600 600

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