Accounting

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1) Reen Lawns, Inc., performs adjusting entries every month, but closes its accounts only at year-end. The company’s year-end adjusted trial balance dated December 31, 2015, was:

GREEN LAWNS, INC. Adjusted Trial Balance December 31, 2015
Cash	$	182,200
Accounts receivable		9,000
Supplies		600
Equipment		24,000
Accumulated depreciation: equipment			$	10,000
Accounts payable				3,000
Income taxes payable				7,000
Capital stock				50,000
Retained earnings				90,000
Dividends		4,000
Lawn care revenue earned				192,000
Salary expense		104,000
Supply expense		2,400
Advertising expense		600
Depreciation expense: equipment		2,000
Income taxes expense		23,600

	$	352,000	$	352,000

a-1.	Prepare an income statement for the year ended December 31, 2015.

a-2.	Prepare a statement of retained earnings for the year ended December 31, 2015.

a-3.	Prepare the company's balance sheet dated December 31, 2015. (Amounts to be deducted should be indicated by a minus sign.)

Does the company appear to be liquid?

	No
	Yes

Has the company been profitable in the past?

	No
	Yes

2) Reen Lawns, Inc., performs adjusting entries every month, but closes its accounts only at year-end. The company’s year-end adjusted trial balance dated December 31, 2015, was:

GREEN LAWNS, INC. Adjusted Trial Balance December 31, 2015
Cash	$	182,200
Accounts receivable		9,000
Supplies		600
Equipment		24,000
Accumulated depreciation: equipment			$	10,000
Accounts payable				3,000
Income taxes payable				7,000
Capital stock				50,000
Retained earnings				90,000
Dividends		4,000
Lawn care revenue earned				192,000
Salary expense		104,000
Supply expense		2,400
Advertising expense		600
Depreciation expense: equipment		2,000
Income taxes expense		23,200

	$	352,000	$	352,000

a.	Prepare all necessary closing entries at December 31, 2015.

1. Record the entry to close Lawn Care Revenue earned to income summary

2. REcord the entry to close all expense accounts to income summary

3. Record the entry to transfer net income earned in 2015 to retained earnings account

4. Record the entry to close dividends declared in 2015 to retained earnings account.

Prepare an after-closing trial balance dated December 31, 2015.

· Record the entry to close all expense accounts to income summary.

3) Cat Fancy, Inc., has provided the following information from its most current financial statements:


Total revenue	$	125,000
Total expenses		80,000
Total current assets		32,000
Total current liabilities		8,000
Total stockholders' equity, January 1, 2015		74,000
Total stockholders' equity, December 31, 2015		76,000

Compute the company’s net income percentage in 2015

Compute the company’s return on equity in 2015

Compute the company’s current ratio at December 31, 2015.

Terrific Temps fills temporary employment positions for local businesses. Some businesses pay in advance for services; others are billed after services have been performed. Advanced payments are credited to an account entitled Unearned Fees. Adjusting entries are performed on a monthly basis. An unadjusted trial balance dated December 31, 2015, follows. (Bear in mind that adjusting entries have already been made for the first 11 months of 2015, but not for December.)

TERRIFIC TEMPS UNADJUSTED TRIAL BALANCE DECEMBER 31, 2015
Cash	$	27,020
Accounts receivable		59,200
Unexpired insurance		900
Prepaid rent		3,000
Office supplies		600
Equipment		60,000
Accumulated depreciation: equipment			$	29,500
Accounts payable				4,180
Notes payable				12,000
Interest payable				320
Unearned fees				6,000
Income taxes payable				4,000
Unearned revenue				20,000
Retained earnings				49,000
Capital stock				25,000
Dividends		3,000
Fees earned				75,000
Travel expense		5,000
Insurance expense		2,980
Rent expense		9,900
Office supplies expense		780
Utilities expense		4,800
Depreciation expense: equipment		5,500
Salaries expense		30,000
Interest expense		320
Income taxes expense		12,000

	$	225,000	$	225,000

Other Data
1.	Accrued but unrecorded fees earned as of December 31, 2015, amount to $1,500.
2.	Records show that $2,500 of cash receipts originally recorded as unearned fees had been earned as of December 31.
3.	The company purchased a six-month insurance policy on September 1, 2015, for $1,800.
4.	On December 1, 2015, the company paid its rent through February 28, 2016.
5.	Office supplies on hand at December 31 amount to $400.
6.	All equipment was purchased when the business first formed. The estimated life of the equipment at that time was 10 years (or 120 months).
7.	On August 1, 2015, the company borrowed $12,000 by signing a six-month, 8 percent note payable. The entire note, plus six months' accrued interest, is due on February 1, 2016.
8.	Accrued but unrecorded salaries at December 31 amount to $2,700.
9.	Estimated income taxes expense for the entire year totals $15,000. Taxes are due in the first quarter of 2016.

Instructions

For each of the numbered paragraphs, prepare the necessary adjusting entry 1. Record the accrued but uncollected fees earned 2. Record fees earned as of December 31st 3. Record the December insurance expense 4. REcord the December rent expense 5. Record the offices supplies used in December 6. Record the December depreciation expense 7. Record the interest accrued in December 8. Record the salaries accrued in December 9. Record the income taxes accrued in December B. Determine that amount at which each of the following accounts will be reported in the company’s 2015 income statement: 1. FEES EARNED 2. TRAVELS EXPENSE 3. INSURANCE EXPERIENCE 4. RENT EXPENSE 5. OFFICE SUPPLIES EXPERIENCE 6. UTILITIES EXPENSE 7. DEPRECIATION EXPENSE: EQUIPMENT. 8. INTERNET EXPENSE 9. SALARY EXPENSE 10. INCOME TAX EXPENSE.

The unadjusted trial balance reports dividends of $3,000. As of December 31, 2015, have these dividends been paid?

	Yes
	No