Ex1:

Ex2:

Ex3:
 4.

WATSON ANVILS
Adjusted Trial Balance
December 31, 2018

Debit Credit

Cash $13,560
Accounts Receivable 17,000
Prepaid Rent 2,000
Office Supplies 2,200
Equipment 30,000
Accumulated Depreciation - Equipment $11,400
Accounts Payable 7,200
Salaries Payable 180
Unearned Revenue 3,600
Watson, Capital 29,600
Watson, Withdrawals 4,600
Service Revenue 21,000
Salaries Expense 2,480
Rent Expense 140
Depreciation Expense-Equipment 400
Supplies Expense 600
Totals $72,980 $72,980
5.
WATSON ANVILS
Income Statement
For the year ended December 31, 2018
Revenue
Service Revenue $21,000
Expenses
Salaries Expense $2,480
Rent Expense 140
Depreciation Expense - Equipment 400
Supplies Expense 600
Total Expenses 3,620
Net Income $17,380

WATSON ANVILS
Owner’s Equity Statement
For the year ended December 31, 2018
Owner’s Capital, January 1, 2018 $29,600
Add: Net income 17,380
46,980
Less: Owner’s Drawings 4,600
Owner’s Capital, December 31, 2018 $42,380

WATSON ANVILS
Classified Balance Sheet
December 31, 2018
Assets
Current Assets
Cash $13,560
Accounts Receivable 17,000
Prepaid Rent 2,000
Office Supplies 2,200
Total Current Assets $34,760
Property, Plant, and Equipment
Equipment 30,000
Less: Accumulated Depreciation - Equipment 11,400 18,600
Total Assets $53,360
Liabilities and Owner’s Equity
Liabilities
Current Liabilities
Accounts Payable $7,200
Salaries Payable 180
Unearned Revenue 3,600
Total Current Liabilities $10,980
Owner’s Equity
Owner’s Capital 42,380
Total Liabilities and Owner’s Equity $53,360
6. Closing Entries:
(1) Service Revenue………………………………………………………………………….21,000
Income Summary…………………………………………………………………………………21,000
(To close revenue account)

(2) Income Summary………………………………………………………………………….3,620

Salaries Expense……………………………………………………………………………………..2,480
Rent Expense…………………………………………………………………………………………….140
Depreciation Expense-Equipment………………………………………………………………400
Supplies Expense……………………………………………………………………………………….600
(To close expense accounts)

(3) Income Summary…………………………………………………………………….....17,380

Watson,Capital……………………………………………………………………………………….17,380
(To close net income to capital)

(4) Watson,Capital……………………………………………………………………………....4,600
Watson,Withdrawals……………………………………………………………………................4,600
(To close withdrawals to capital)

Entries posted to ledger accounts.

Service Revenue

Date Debit Credit Balance

December 31 21,000

(1) 21,000 0

Salaries Expense

Date Debit Credit Balance

December 31 2,480

(2) 2,480

0
Rent Expense

Date Debit Credit Balance

December 31 140

(2) 140

Depreciation Expense-Equipment

Date Debit Credit Balance

December 31 400

(2) 400

Supplies Expense

Date Debit Credit Balance

December 31 600

(2) 600

0
Income Summary

Date Debit Credit Balance

December 31 (1) 21,000 21,000

3,620 17,380
(2)

17,380 0
(3)

Watson,Withdrawals

Date Debit Credit Balance

December 31 4,600

(4) 4,600

Watson,Capital

Date Debit Credit Balance

December 31 29,600

17,380 46,980
(3)

(4) 4,600 42,380

7.

WATSON ANVILS
Post-Closing Trial Balance
December 31,2018

Debit Credit

Cash $13,560
Accounts Receivable 17,000
Prepaid Rent 2,000
Office Supplies 2,200
Equipment 30,000
Accumulated Depreciation - Equipment $11,400
Accounts Payable 7,200
Salaries Payable 180
Unearned Revenue 3,600
Watson, Capital 42,380
Totals $64,760 $64,760