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  • 04 Prelim Examination

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    Jomarie Benedicto
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    The trial balance for Ily Abella Surveyors as of May 31, 2020 is presented along with year-end adjustment information. Adjusting journal entries need to be made to recognize prepaid, unearned and accrued revenues and expenses. The adjusted accounts will be used to prepare the year-end financial statements including the income statement, statement of changes in equity, and balance sheet. Closing entries are also required to close revenue and expense accounts to retained earnings.

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    The trial balance for Ily Abella Surveyors as of May 31, 2020 is presented along with year-end adjustment information. Adjusting journal entries need to be made to recognize prepaid, unearned and accrued revenues and expenses. The adjusted accounts will be used to prepare the year-end financial statements including the income statement, statement of changes in equity, and balance sheet. Closing entries are also required to close revenue and expense accounts to retained earnings.

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    23 views2 pages

    04 Prelim Examination

    Uploaded by

    Jomarie Benedicto
    The trial balance for Ily Abella Surveyors as of May 31, 2020 is presented along with year-end adjustment information. Adjusting journal entries need to be made to recognize prepaid, unearned and accrued revenues and expenses. The adjusted accounts will be used to prepare the year-end financial statements including the income statement, statement of changes in equity, and balance sheet. Closing entries are also required to close revenue and expense accounts to retained earnings.

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    © All Rights Reserved
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    of 2

    PRELIM EXAMINATION

    YEAR-END PROCEDURES

    PROBLEM NO. 1
    The May 31, 2020 trial balance for lly Abella Surveyors is presented
    as follows:

    Ily Abella Surveyors


    Trial Balance
    May 31, 2020

    Cash 210,000
    Accounts Receivable 930,000
    Prepaid Advertising 360,000
    Engineering Supplies 270,000
    Survey Equipment 1,890,000
    Accum. Depreciation-Survey Equipt. 640,000
    Accounts Payable 190,000
    Unearned Survey Revenues 120,000
    Notes Payable 500,000
    Abella, Capital 1,120,000
    Abella, Withdrawals 700,000
    Survey Revenues 6,510,000
    Salaries Expense 3,270,000
    Rent Expense 960,000
    Insurance Expense 250,000
    Utilities Expense 160,000
    Miscellaneous Expense 80,000  
    TOTAL 9,080,000 9,080,000

    The following information pertaining to the year-end adjustments is


    available:
    A. The P360,000 prepaid advertising represents expenditure made on
    Nov. 1, 2019 for monthly advertising over the next 18 months.
    B. A count of the engineering supplies at May 31, 2020 amounted to
    P90,000.
    C. Depreciation on the surveying equipment amounted to P160,000.
    D. One-third of the unearned survey revenues has been earned at
    year-end.
    E. At year-end, salaries in the amount of P140,000 have accrued.
    F. Interest of P60,000 on the notes payable has accrued at year-end.

    Required:
    1. Adjusting Journal Entries.
    2. Prepare the following documents: worksheet, income statement,
    statement of changes in equity, balance sheet.
    3. Closing entries.
    4. Post-Closing Trial Balance.
    5. Reversing entries.

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