Instructions for the Microsoft Excel Templates

Be advised, the worksheet and workbooks are not protected.

Extensive detail and information is contained within the manual.

Striking the "F1" key or following the path "Windows>Excel Help" will invoke the Office Assistant and bring up one of
several help menus.

You should enter your name, course ID, and date name into the cells at the top of the page.

Each page contains a page footer with a Page # of Page ## as well as time and date to assist in assembly of multiple
pages.

Each worksheet contains the identification of the problem or exercise.

All formatting should have been accomplished to provide satisfactory presentation. See the text for additional assistance
in formatting.

There should be no need to insert columns or rows into the workbooks.

If more than one page is required by the problem, the page breaks are preset.

In general, the yellow highlighted cells are the cells which work and effort should be presented.

Place the proper account title in the cell where the word "Account title" appears on the template.

Place the value in the cell where the word "Value" or "Amount" appears on the template. A formula may be placed in
some of these cells.

Write a formula into cells where the word "Formula" appears. In these cells, an amount calculated can be entered. An
amount can be placed in these cells.

Place the explanation for the entry in the cell where the word "Text Explanation" appears on the template.

Insert the account number where "Acct Nbr" appears on the template during posting.

Insert the journal reference where "JOURN #" appears on the template during posting.

Insert the title in the cell where "TITLE" appears on the template.

The print area is defined to fit onto 8 1/2" X 11" sheets in portrait or landscape mode as required.

The gray filled cells define the perimeter of the problem and the print area.

The problem is formatted for whole dollars with comma separations (no cents) except where required.

The display may have "Freeze Pane" invoked so column titles remain visible during data entry.

Negative values may be shown as ($400) or -$400.

Consider using "Split" panes to assist in copy and paste of data.

Much of the exercises and problems can have data entered by the "look to" or "=A34" type formula where cell A34
contains the data to be entered. This precludes typing and data entry errors.
Name: Jenny G. Hermosado
Problem: P2 Adjusting Entries and Financial Statements
Course: Acty- 1101
Date:
Mason Advertising Agency was founded in January 2006. Presented below are adjusted and unadjusted trial
balances as of December 31, 2010.

MASON ADVERTISING AGENCY

Trial Balance
December 31, 2010
Unadjusted Adjusted
Debit Credit Debit Credit
Cash 11,000 11,000
Accounts Receivable 20,000 23,500
Art Supplies 8,400 3,000
Prepaid Insurance 3,350 2,500
Printing Equipment 60,000 60,000
Accumulated Depreciation - Equip 28,000 33,000
Accounts Payable 5,000 5,000
Interest Payable 0 150
Notes Payable 5,000 5,000
Unearned Advertising Revenue 7,000 5,600
Salaries Payable 0 1,300
Share Capital - Ordinary 10,000 10,000
Retained Earnings 3,500 3,500
Advertising Revenue 58,600 63,500
Salaries Expense 10,000 11,300
Insurance Expense 850
Interest Expense 350 500
Depreciation Expense 5,000
Art Supplies Expense 5,400
Rent Expense 4,000 4,000
Totals: $117,100 $117,100 $127,050 $127,050

Instructions:
(a) Journalize the annual adjusting entries that were made. (Omit explanations.)
Dec 31 Accounts Receivable 3,500
Advertising Revenue 3,500

Dec 31 Insurance Expense 850

Prepaid Insurance 850

Dec 31 Depreciation Expense 5,000

Accumulated Deprecuation-Equipment 5,000

Problem 3-2, Page 3 of 5, 06/14/2020, 04:51:25

 Dec 31 Interest Expense 150
Interest Payable 150

Dec 31 Unearned Advertising Revenue 1,400

Advertising Revenue 1,400

Dec 31 Salaries Expense 1,300

Salaries Payable 1,300

Dec 31 Art Supplies Expense 5,400

Art Supplies 5,400

(b) Prepare an income statement and a retained earnings statement for the year ending
December 31, 2010, and an unclassified statement of financial position at December 31.

MASON ADVERTISING AGENCY

Income Statement
For the Year Ended December 31, 2010
Revenues
Advertising Revenue $63,500
Expenses
Salaries Expense $11,300
Insurance Expense 850
Interest Expense 500
Depreciation Expense 5,000
Art Supplies Expense 5,400
Rent Expense 4,000
Total expenses 27,050
Net income $36,450

MASON ADVERTISING AGENCY

Statement of Retained Earnings
For the Year Ended December 31, 2010
Retained Earnings, Jan 1 $3,500
Add: Net Income 36,450
Retained Earnings, Dec 31 $39,950

MASON ADVERTISING AGENCY

Statement of Financial Position
December 31, 2010
Assets
Cash $11,000
Account Receivable 23,500 $34,500
Art Supplies 3,000
Prepaid Insurance 2,500
Printing Equipment 60,000
less: Accumulated Depreciation- Equipment 33,000
Total Assets $67,000

Problem 3-2, Page 4 of 5, 06/14/2020, 04:51:25

 Equity and Liabilities
Equity
Share Capital- Ordinary $10,000
Retained Earnings 3,500 $13,500
Liabilities
Accounts Payable 5,000
Interest Payable 150
Notes Payable 5,000
Unearned Advertising Revenue 5,600
Salaries Payable 1,300
Total Liabilities 17,050
Total Equity and Liabilities $30,550

(c) Answer the following questions:

(1) If the note has been outstanding 3 months, what is the annual interest rate on that note?

(Interest is 150/3 months) 50 per moth or (50,000 X 50) 1.00% of the note payable. This 1.00% X 12moths equals an
annual interest rate of 12.00% interest per year. Therefore, the annual Interest rate on the note is 12% or 50 per
month.

(2) If the company paid $12,500 in salaries in 2010, what was the balance in Salaries Payable on
December 31, 2009?

Salaries Expense $11,300 less Salaries Payable 12/31/10 $1,300= $10,000. Total payments $12,500-
$10,000=$2500 12/31/09. Therefore 2500 is the balance in Salaries payable on Dec 31,2009.

Problem 3-2, Page 5 of 5, 06/14/2020, 04:51:25