# Weygandt, Accounting Principles1 - 19846

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Weygandt, Accounting Principles1 (*****Also All Calculation Work Submitted in Other Word Files for understanding*****)

Fernetti Advertising Agency was founded by John Fernetti in January of 2011. Presented below are both the adjusted and unadjusted trial balances as of December 31, 2012.

 FERNETTI ADVERTISING AGENCY Trial Balance December 31, 2012 Unadjusted Adjusted Dr. Cr. Dr. Cr. Cash \$11,000 \$11,000 Accounts Receivable 20,000 22,500 Art supplies 8,600 5,000 Prepaid insurance 3,350 2,500 Printing equipment 60,000 60,000 Accumulated depreciation \$28,000 \$34,000 Accounts payable 5,000 5,000 Interest payable –0– 150 Notes payable 5,000 5,000 Unearned Advertising Fees 7,200 5,600 Salaries payable –0– 1,300 J. Fernetti, Capital 25,500 25,500 J. Fernetti, Drawing 12,000 12,000 Advertising revenue 58,600 62,700 Salaries expense 10,000 11,300 Insurance expense 850 Interest expense 350 500 Depreciation expense 6,000 Art supplies expense 3,600 Rent expense 4,000 4,000 \$129,300 \$129,300 \$139,250 \$139,250

Instructions

(b) Complete the income statement and a statement of owner\'s equity for the year ending December 31, 2012, and a balance sheet at December 31. (List multiple entries from largest to smallest e.g. 10, 5, 3, 2. For the balance sheet, list assets in order of liquidity and liabilities from largest to smallest e.g. 10, 5, 3, 2, with notes payable then accounts payable first.)

1.    If the note has been outstanding 6 months, what is the annual interest rate on that note?

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