Financial & Managerial Accounting 3rd Edition by Charles Horngren,Harrison, Walter,Suzanne Oliver

Exercise 18

Completing the accounting cycle
The trial balance of Leopard Anvils, Inc., at January 31, 2012, and the data for the month-end adjustments follow:

Adjustment data:
a. Unearned service revenue still unearned at January 31, $400.
b. Prepaid rent still in force at January 31, $1,800.
c. Supplies used during the month, $1,100.
d. Depreciation for the month, $400.
e. Accrued salary expense at January 31, $500.
Requirements
1. Prepare adjusting journal entries.
2. Enter the trial balance on a worksheet and complete the worksheet through the Adjusted Trial Balance of Leopard Anvils for the month ended January 31, 2012.
3. Prepare the income statement, the statement of retained earnings, and the classified balance sheet in report form.
4. Using the worksheet data that you prepared, journalize and post the adjusting and closing entries to T-accounts. Use dates and show the ending balance of each account.
5. Prepare a post-closing trial balance.
6. Calculate the current and debt ratios for the company.