Reference no: EM131929384

Question: Problem 1: Davis & Bell began a health clinic as a corporation in 2014. Several transactions which occurred early in 2014 are descibed below. Record each transaction in proper journal entry form, excluding written explanations.

Required: Record each transaction in proper journal entry form, excluding written explanations.

A 1/15/2014 Stockholders invested $90,000 in the business and received shares of common stock as evidence of ownership.

B 2/1/2014 Rent of $2,000 was paid for the month of February

C 2/10/2014 Equipment with a cost of $10,000 was purchased on credit; payment is due in 30 days.

D 2/14/2014 Fees totaling $5,500 were billed to patients; $3,000 was collected immediately and the balance of $2,500 is due within 30 days.

E 2/19/2014 Full payment was made for the equipment purchased on February 10th.

Problem 2: At year end, you have the following data for adjustments:

a. An analysis indicates that prepaid rent on December 31 should be $4,000

b. A physical inventory shows that $1,650 of office supplies is on hand.

c. Depreciation for 2014 is $40,000

d. An analysis indicates that unearned service revenue should be $6,500

e. Wages of $5,500 are owed but unpaid and unrecorded at year end.

f. Six month's interest at 5% on the note was paid on September 30. Interest for the period October 1 to December 31 is unpaid and unrecorded.

REQUIRED: 1. Prepare the adjusting entries.

2. After posting the adjusting entries, prepare an adjusted trial balance.

Problem 3: Required: (1) Prepare an Income Statement

(2) Prepare a Statement of Retained Earnings

(3) Prepare a Balance Sheet

Information related to above question is enclosed below:

Attachment:- MidtermExam-PartII.rar