Linda Ace started her own consulting firm, Modine Consulting, Inc. on May 1, 2008.

P3-1B   Linda Ace started her own consulting firm, Modine Consulting, Inc. on May 1, 2008. The trial balance at May 31 is as follows.

                                             MODINE CONSULTING, INC.

                                                          Trial Balance

                                                          May 31, 2008

                          Account Number             Debit                     Credit

101             Cash                                $ 7,700

112            Accounts Receivable              4,000

126           Supplies                                 1,500

130           Prepaid Insurance                    4,800

149          Office Furniture                        9,600

201          Accounts Payable                                                     $ 3,500

209            Unearned Service Revenue                                          3,000

311         Common Stock                                                           19,100

400          Service Revenue                                                          6,000

726          Salaries Expense                     3,000

729          Rent Expense                         1,000

                                                          $31,600                           $31,600

In addition to those accounts listed on the trial balance, the chart of accounts for Modine Consulting also contains the following accounts and account numbers:

No. 150     Accumulated Depreciation—Office Furniture,

No. 212     Salaries Payable,

No. 229     Travel Payable,

No. 631     Supplies Expense,

No. 717     Depreciation Expense,

No. 722      Insurance Expense, and

No. 736      Travel Expense.

Other data:

1.  $500 of supplies have been used during the month.

2.  Travel expense incurred but not paid on May 31, 2008, $200.

3.  The insurance policy is for 2 years.

4.  $1,000 of the balance in the unearned service revenue account remains unearned at the end of the month.

5.  May 31 is a Wednesday, and employees are paid on Fridays.  Modine Consulting has two employees, who are paid $700 each for a 5-day work week.

6.  The office furniture has a 5-year life with no salvage value. It is being depreciated at $160 per month for 60 months.

7.  Invoices representing $1,000 of services performed during the month have not been recorded as of May 31.

Instructions:

(a)  Prepare the adjusting entries for the month of May. Use J4 as the page number for your journal.

(b)  Post the adjusting entries to the ledger accounts. Enter the totals from the trial balance as beginning account balances and place a check mark in the posting reference column.

(c)  Prepare an adjusted trial balance at May 31, 2008.

Check: (c) Adj. trial balance $33,800