adjusting entries and financial statements the following are the trial balance and 1574308

(Adjusting Entries and Financial Statements) The following are the trial balance and the other information related to Yorkis Perez, a consulting engineer.

1. Fees received in advance from clients $6,000.

2. Services performed for clients that were not recorded by December 31, $4,900.

3. Bad debt expense for the year is $1,430.

4. Insurance expired during the year $480.

5. Equipment is being depreciated at 10% per year.

6. Yorkis Perez gave the bank a 90-day, 10% note for $7,200 on December 1, 2014.

7. Rent of the building is $750 per month. The rent for 2014 has been paid, as has that for January 2015.

8. Office salaries and wages earned but unpaid December 31, 2014, $2,510.

Instructions

(a) From the trial balance and other information given, prepare annual adjusting entries as of December 31, 2014. (Omit explanations.)

(b) Prepare an income statement for 2014, a statement of owner’s equity, and a classified balance sheet. Yorkis Perez withdrew $17,000 cash for personal use during the year.