INSPIRE COMPANY

WORKSHEET
FOR TH E YEAR ENDED DEC. 31, 2019

TRIAL BALANCE ADJUSTMENTS ADJUSTED BALANCES INCOME STATEMENT

CREDIT DEBIT CREDIT DEBIT CREDIT DEBIT CREDIT
Cash 42,000 - 42,000
Accounts Receivable 175,000 - 175,000
Allowance for Bad Debts - - 5,250 5,250
Prepaid Insurance 31,500 - 26,250 5,250
Supplies Unused 15,750 - 9,000 6,750
Building 703,500 - 703,500
Accum. Depreciation - Building 140,700 28,140 168,840
Equipment 506,800 506,800
Accum. Depreciation - Equipment - 202,720 33,787 236,507
Notes Payable - 175,000 175,000
Accounts Payable - 67,200 67,200
Interest Payable - - 17,500 17,500
Salaries Payable - - 15,000 15,000
Gold, Capital - 771,155 771,155
Gold, Drawing 14,000 - 14,000
Service Fee 536,200 536,200 536,200
Salaries Expense 210,700 - 15,000 225,700 225,700
Advertising Expense 64,750 - 64,750 64,750
Utilities Expense 50,750 - 50,750 50,750
Repairs Expense 67,550 - 67,550 67,550
Insurance Expense - - 26,250 26,250 26,250
Supplies Expense - 9,000 9,000 9,000
Depreciation Expense - Building - - 28,140 28,140 28,140
Depreciation Expense - Equipment - - 33,787 33,787 33,787
Interest Expense - - 17,500 17,500 17,500
Bad Debts Expense - - 5,250 5,250 5,250
Miscellaneous Expense 10,675 - 10,675 10,675
Total 1,892,975 1,892,975 134,927 134,927 1,992,652 1,992,652 539,352 536,200
Loss for the period 3,152
 539,352 539,352

INSPIRE COMPANY
Income Statement
For the Year Ended December 31, 2019

Revenue
Service Fee 536,200
Less: Operating Expenses
Salaries Expense 225,700
Advertising Expense 64,750
Utilities Expense 50,750
Repairs Expense 67,550
Insurance Expense 26,250
Supplies Expense 9,000
Depreciation Exp-Bldg 28,140
Depreciation Exp-Equipt 33,787
Interest Expense 17,500
Bad Debts Expense 5,250
Miscellaneous Expense 10,675
Total Operating Expenses 539,352
Profit for the Period - 3,152

INSPIRE COMPANY
 Statement of Changes in Owner's Equity
For the Year Ended December 31, 2019

Beginning Capital 771,155

Profit for the Period - 3,152
Drawing - 14,000
Capital, End 754,003

INSPIRE COMPANY
Statement of Financial Position
December 31, 2019
ASSETS
Current Assets
Cash 42,000
Accounts Receivable 175,000
Allowance for Bad Debts (5,250) 169,750
Prepaid Insurance 5,250
Supplies Unused 6,750
Total Current Assets 223,750
Non Current Assets
Building 703,500
Accum. Depr'n.-Building (168,840) 534,660
Equipment 506,800
Accum. Depr'n.-Equipt. (236,507) 270,293
Total Non-Current Assets 804,953
Total Assets 1,028,703

LIABILITIES
Curent Liabilities:
Notes Payable 175,000
Accounts Payable 67,200
Interest Payable 17,500
Salaries Payable 15,000
Total Current Liabilities 274,700
 OWNER'S EQUITY

Gold, Capital 754,003

Total Liabilities and Owner's Equity 1,028,703

INSPIRE COMPANY
Post-Closing Trial Balance
December 31, 2019
Debit Credit
Cash 42,000
Accounts Receivable 175,000
Allowance for Bad Debts 5,250
Prepaid Insurance 5,250
Supplies Unused 6,750
Building 703,500
Accum. Depr'n.-Building 168,840
Equipment 506,800
Accum. Depr'n.-Equipt. 236,507
Notes Payable 175,000
Accounts Payable 67,200
Interest Payable 17,500
Salaries Payable 15,000
Gold, Capital 754,003
1,439,300 1,439,300
 Additional Data:
1. Used supplies for the period P9,000.
2. Prepaid insurance represents a one year policy effective March 1, 2019.
STATEMENT OF 3. The estimated useful life of building is 25 years without salvage value.
FINANCIAL POSITION The estimated useful life of equipment is 15 years without salvage value.
DEBIT CREDIT 4. Bad debts past experience is 3% of Accounts Receivable.
42,000 5. Interest accrued but not paid on notes payable on December 31, is P17,500
175,000 6. Salaries expense incurred but not yet paid at the end of the period is P15,000.
5,250
5,250 Adjusting entries:
6,750
703,500 1) Supplies Expense 9,000
168,840 Supplies Unused 9,000
506,800
236,507
175,000 2) Insurance Expense 26,250
67,200 Prepaid Insurance 26,250
17,500 31,500/12*10
15,000
771,155 3) Deprn Exp-Bldg 28,140
14,000 Deprn Exp-Equipt 33,787
Accum. Deprn-Building 28,140
Accum. Deprn-Equipt 33,787

4) Bad Debts Expense 5,250

Allow. For Bad Debts 5,250

5) Interest Expense 17,500

Interest Payable 17,500

6) Salaries Expense 15,000

Salaries and Wages Payable 15,000

1,453,300 1,456,452
3,152 Closing Entries:
1,456,452 1,456,452 1) Service Fee 536,200
Income Summary 536,200

2) Income Summary 539,352

Salaries Expense 225,700
Advertising Expense 64,750
Utilities Expense 50,750
Repairs Expense 67,550
Insurance Expense 26,250
Supplies Expense 9,000
Depreciation Exp-Bldg 28,140
Depreciation Exp-Equipt 33,787
Interest Expense 17,500
Bad Debts Expense 5,250
Miscellaneous Expense 10,675

3) Inspire, Capital 3,152

Income Summary 3,152
To close Income Summary account to Capital account.
-
4) Gold, Capital 14,000
Gold, Drawing 14,000

Reversing Entry

Salaries and Wages Payable 15,000

Salarries and Wages 15,000