rockford management services inc began business on january 1 2011 with a capital inv 581577

Rockford Management Services Inc. began business on January 1, 2011, with a capital investment of $120,000. The company manages condominiums for owners (Service Revenue) and rents space in its own office building (Rent Revenue). The trial balance and adjusted trialbalance columns of the worksheet at the end of the first year are as follows.

ROCKFORD MANAGEMENT SERVICES INC.

Worksheet

For the Year Ended December 31, 2011

Account Titles

Dr.

Cr.

Dr.

Cr.

Cash

13,800

Accounts Receivable

28,300

Prepaid Insurance

3,600

Land

67,000

Building

127,000

Equipment

59,000

12,500

Accounts Payable

12,500

2,000

Unearned Rent Revenue

6,000

120,000

Mortgage Note Payable

120,000

100,000

Common Stock

100,000

44,000

Retained Earnings

44,000

12,500

Dividends

22,000

Service Revenue

90,700

90,700

Rent Revenue

29,000

33,000

Salaries Expense

42,000

Advertising Expense

20,500

Utilities Expense

19,000

Totals

402,200

402,200

Insurance Expense

1,200

Depreciation Expense—Building

3,000

Accumulated Depreciation—Building

3,000

Depreciation Expense—Equipment

4,700

Accumulated Depreciation—Equipment

4,700

Interest Expense

11,000

Interest Payable

11,000

Totals

420,900

420,900

Instructions

(a) Prepare a complete worksheet.

(b) Prepare a classified balance sheet. (Note: $20,000 of the mortgage note payable is due for payment next year.)

(c) Journalize the adjusting entries.

(d) Journalize the closing entries.

(e) Prepare a post closing trial balance.