80.2K

Verified Solution

Link Copied!

Parker Technical Institute (PTI), a school owned by Paula Parker, provides training to individuals who pay tuition directly to the school. PTI also offers training to groups in off-site locations. Its unadjusted trial balance as of December 31, is found on the trial balance tab. PTI initially records prepaid expenses and unearned revenues in balance sheet accounts. Descriptions of items a through h that require adjusting entries on December 31 a. An analysis of PTI's insurance policies shows that $2.650 of coverage has expired. b. An inventory count shows that teaching supplies costing $3,720 are available at year-end. C. Annual depreciation on the equipment is $4,600. d. Annual depreciation on the professional library is $8.600. e. On September 1, PTI agreed to do five courses for a client for $3.000 each. Two courses will start immediately and finish before the end of the year. Three courses will not begin until next year. The client paid $15.000 cash in advance for all five courses on September 1, and PTI credited Unearned Training Fees f. On October 15, PTI agreed to teach a four-month class (beginning immediately) for an executive with payment due at the end of the class. At December 31, $8.500 of the tuition has been earned by PTI. g. PTI's two employees are paid weekly. As of the end of the year, two days' salaries have accrued at the rate of $160 per day for each employee h. The balance in the Prepaid Rent account represents rent for December Requirement General Journal General Ledger Trial Balance Income Statement St Owner Equity Balance Sheet Impact on income General Journal tab - For transactions a-h, review the unadjusted balance and prepare the adjusting entry necessary to correctly report the revenue earned or the expense incurred. After adjusting the accounts, review the financial statements for accuracy. General Ledger tab - Each journal entry is posted automatically to the general ledger. Use the drop-down button to view the unadjusted or adjusted balances. Trial Balance tab - You may view either the unadjusted or adjusted trial balance by choosing from the dropdown box below. Your choice will determine the reported values on the financial statement tabs. Income Statement tab - Use the drop-downs to select the accounts properly included on the income statement. The unadjusted or adjusted balances will appear for each account, based on your selection. Statement of Owner's Equity tab - The unadjusted or adjusted balances will appear for each account, based on your selection. Balance Sheet tab - Use the drop-downs to select the accounts properly included on the balance sheet. The unadjusted or adjusted balances will appear for each account, based on your selection. Impact on Income tab - For each adjustment, indicate the income statement and balance sheet account affected, and the impact on net income. If an adjustment caused net income to decrease, enter the amount as a negative value. Net income before adjustments can be found on the income statement tab. (Hint: Select unadjusted on the dropdown.) Parker Technical Institute (PTI), a school owned by Paula Parker, provides training to individuals who pay tuition directly to the school. PTI also offers training to groups in off-site locations. Its unadjusted trial balance as of December 31, is found on the trial balance tab. PTI initially records prepaid expenses and unearned revenues in balance sheet accounts. Descriptions of items a through h that require adjusting entries on December 31 a. An analysis of PTI's insurance policies shows that $2.650 of coverage has expired. b. An inventory count shows that teaching supplies costing $3,720 are available at year-end. C. Annual depreciation on the equipment is $4,600. d. Annual depreciation on the professional library is $8.600. e. On September 1, PTI agreed to do five courses for a client for $3.000 each. Two courses will start immediately and finish before the end of the year. Three courses will not begin until next year. The client paid $15.000 cash in advance for all five courses on September 1, and PTI credited Unearned Training Fees f. On October 15, PTI agreed to teach a four-month class (beginning immediately) for an executive with payment due at the end of the class. At December 31, $8.500 of the tuition has been earned by PTI. g. PTI's two employees are paid weekly. As of the end of the year, two days' salaries have accrued at the rate of $160 per day for each employee h. The balance in the Prepaid Rent account represents rent for December Requirement General Journal General Ledger Trial Balance Income Statement St Owner Equity Balance Sheet Impact on income General Journal tab - For transactions a-h, review the unadjusted balance and prepare the adjusting entry necessary to correctly report the revenue earned or the expense incurred. After adjusting the accounts, review the financial statements for accuracy. General Ledger tab - Each journal entry is posted automatically to the general ledger. Use the drop-down button to view the unadjusted or adjusted balances. Trial Balance tab - You may view either the unadjusted or adjusted trial balance by choosing from the dropdown box below. Your choice will determine the reported values on the financial statement tabs. Income Statement tab - Use the drop-downs to select the accounts properly included on the income statement. The unadjusted or adjusted balances will appear for each account, based on your selection. Statement of Owner's Equity tab - The unadjusted or adjusted balances will appear for each account, based on your selection. Balance Sheet tab - Use the drop-downs to select the accounts properly included on the balance sheet. The unadjusted or adjusted balances will appear for each account, based on your selection. Impact on Income tab - For each adjustment, indicate the income statement and balance sheet account affected, and the impact on net income. If an adjustment caused net income to decrease, enter the amount as a negative value. Net income before adjustments can be found on the income statement tab. (Hint: Select unadjusted on the dropdown.)

Answer & Explanation Solved by verified expert

See Answer