Next Job Inc provides employment consulting services The

company adjusts

Next Job, Inc., provides employment consulting services. The company adjusts its accounts
monthly but performs closing entries annually on December 31. The firm's unadjusted trial
balance dated December 31, current year, is shown as follows.

Other Data

1. Accrued but unrecorded and uncollected consulting fees earned total $25,000 at December
31, current year.

2. The company determined that $15,000 of previously unearned consulting services fees had
been earned at December 31, current year.

3. Office supplies on hand at December 31 total $300.

4. The company purchased all of its equipment when it first began business. At that time, the
estimated useful life of the equipment was six years (72 months).

5. The company prepaid its nine-month rent agreement on June 1, current year.

6. The company prepaid its six-month insurance policy on December 1, current year.

7. Accrued but unpaid salaries total $12,000 at December 31, current year.

8. On September 1, current year, the company borrowed $60,000 by signing an 8-month, 4

percent note payable. The entire amount, plus interest, is due on March 1, next year.

9. The company's accounting firm estimates that income taxes expense for the entire year is
$50,000. The unpaid portion of this amount is due early in the next year.

Instructions

a. Prepare the necessary adjusting journal entries on December 31, current year. Also prepare
an adjusted trial balance dated December 31, current year.

b. From the adjusted trial balance prepared in part a, prepare an income statement and
statement of retained earnings for the year ended December 31, current year. Also prepare the
company's balance sheet dated December 31, current year.

c. Prepare the necessary year-end closing entries.

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 d. Prepare an after-closing trial balance.

e. Compute the company's average monthly insurance expense for January through November
of the current year.

f. Compute the company's average monthly rent expense for January through May of the
current year.

g. If the company purchased all of its office equipment when it first incorporated, for how long
has it been in business as of December 31, current year?

h. Assume that the company had a note payable outstanding on January 1, current year, that it
paid off on April 1, current year. How much interest expense accrued on this note in the current
year?

Next Job Inc provides employment consulting services The company adjusts
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services-the-company-adjusts/

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