Reference no: EM1315923

Preparation of income statement from trail balance and after adjustments.

Client still more operates a private investigating agency called still more invegestigations. Some clients pay in advance for services; others are billed after services have been performed. Advanced payments are credited to an account entitled Unearned retainer fees. Adjusting entries are performed on  a monthly basis, the unadjusted trial balance accounts as of dec. 31,2008 are presented to you in random order as follows:

(bear in mind that adjusting entries have been made for the first 11 months of 2008, but not for the month of December)

	DR		CR
Cash	$40,585
Office equipment		54,000
Accounts payable					1,400
Unearned retainer fees				3,500
Accounts receivable		2,000
Retained earnings					8,000
Office supplies		205
Prepaid rent			1,200
Accumulated depreciation office equipment	35,250
Unexpired insurance		270
Dividens						1,000
Client fees earned							60,000
Interest payable							360
Capital stock								30,000
Depreciation expense-office equipment	8,250
Income tax payable							1,750
Notes payable								9,000
Office supplies expense		605
Rent expense					5,775
Insurance ezpense				1,010
Salaries expense				27,100
Interest expense				360
Income tax expense			6,900
						__________________________________
				Totals			$149,260		$149,260

other data:

1. accrued but unrecorded client fees earned at dec. 31 amounted to $1500

2. records show that $2500 of cash receipts originally recorded as unearned retainer fees had been earned as of dec. 31

3. office supplies on hand at dec 31 amounts to $110

4. the company purchased all of its office equipment when it first began business at that time the equipment estimated useful life was 6 years

5. on oct. 1,2008 the company renewed its rental agreement paying $1,800 cash for 6 months rent in advance

6. on march 1 of the current year the company paid $1080 cash to renew its 12 month insurance policy

7. accrued but unrecorded salaries at dec. 31 amount to $1900

8. On june 1, 2008 the company borrowed money from the bank by signing a $9000, 8 percent, 12 month note payable. The entire note plus 12 months accrued interest is due on May 31 2009

9. the companys CPA estimates that income taxes expense for the entire year is $7500

Question:

Prepare an income statement