The General Ledger account balances as of December 31, 20XX, for the Cougar Detective Agency are entered in the Trial Balance columns of the work sheet on pages 78 and 79.
REQUIRED: Complete the work sheet, using the following additional data, and then answer questions 6 through 9. DO NOT send the work sheet to us.
Additional data as of December 31, 20XX (ADJUSTING ENTRIES):
a. Depreciation of $1,050 on the vehicle and $305 on office equipment hasn’t been recorded for the current year $1,355
b. Salaries due but unpaid at year end 250
c. A physical count of unused office supplies showed a balance of $180 180
d. Interest due on notes payable 30
e. Services billed to clients for December haven’t yet been recorded 740
6. On the Balance Sheet for the Cougar Detective Agency, the balance in the Office Supplies account will be shown as a
A. debit of $180. C. debit of $340.
B. credit of $180. D. credit of $340.
7. The balance to be shown in the Fee Revenue account on the Income Statement for the Cougar Detective Agency is a
A. debit of $23,705. C. debit of $24,445.
B. credit of $23,705. D. credit of $24,445.
8. What is the net income for the Cougar Detective Agency for the year ended December 31, 20XX?
A. $8,815. C. $10,170.
B. $9,155. D. $14,175.
9. The balance to be shown in the Accumulated Depreciation—Vehicle account on the Balance Sheet for the Cougar Detective Agency is a credit of
A. $1,050. C. $2,200.
B. $2,100. D. $2,405.
Base your answers to questions 10 through 15 on the following information:
The Mid-Valley Accounting Agency, owned and operated by Jeffery Thomas, organized for business on January 1, 20XX. It’s assumed, in this problem, that 11 months have elapsed since the company began operations, and that the January 1 through November 30 transactions have been entered in the journal and posted to the ledger. The company’s chart of accounts is as follows:
MID-VALLEY ACCOUNTING AGENCY
10. On December 26, cash in the amount of $175 was received for work performed. When you record this transaction in the General Journal, to which account should the credit entry be made?
A. Cash C. Interest Income
B. Accounts Payable D. Fee Income
11. What is the correct adjusting entry for the expired insurance premium as of December 31?
A. Insurance Expense 1,800
Prepaid Insurance 1,800
B. Prepaid Insurance 1,800
Insurance Expense 1,800
C. Insurance Expense 900
Prepaid Insurance 900
D. Prepaid Insurance 900
Insurance Expense 900
12. What is the net income for the Mid-Valley Accounting Agency for the year ended December 31, 20XX?
A. $13,440. C. $15,240.
B. $14,105. D. $16,350.
13. The balance in the Cash account, as shown on the work sheet in the Balance Sheet debit column, is
A. $4,305. C. $2,995.
B. $3,895. D. $2,305.
14. The balance in the Fee Income account, as shown on the work sheet in the Income Statement credit column, is
A. $35,295. C. $37,860.
B. $37,685. D. $38,130.
15. From the information on the work sheet, determine what the balance in the Jeffery Thomas, Capital account would be if a post-closing trial balance is prepared as of December 31, 20XX.
A. $21,490 C. $10,000
B. $15,185 D. $6,250