Uhura Resort opened for business on June 1 with eight air-conditioned units. Its trial balance on August 31 is as follows.
|
UHURA RESORT |
||||
|
Debit |
Credit |
|||
|
Cash |
$23,390 |
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|
Prepaid Insurance |
8,290 |
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|
Supplies |
6,390 |
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|
Land |
24,000 |
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|
Buildings |
124,000 |
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|
Equipment |
20,000 |
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|
Accounts Payable |
$8,290 |
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|
Unearned Rent Revenue |
8,390 |
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|
Mortgage Payable |
54,000 |
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|
Common Stock |
107,790 |
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|
Dividends |
5,000 |
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|
Rent Revenue |
90,200 |
|||
|
Salaries and Wages Expense |
44,800 |
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|
Utilities Expenses |
9,200 |
|||
|
Maintenance and Repairs Expense |
3,600 |
|
||
|
$268,670 |
$268,670 |
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Other data:
1. The balance in prepaid insurance is a one-year premium paid on June 1, 2012.
2. An inventory count on August 31 shows $713 of supplies on hand.
3. Annual depreciation rates are
(a) buildings (4%)
(b) equipment (10%).
Salvage value is estimated to be 10% of cost.
4. Unearned Rent Revenue of $4,139 was earned prior to August 31.
5. Salaries of $389 were unpaid at August 31.
6. Rentals of $820 were due from tenants at August 31.
7. The mortgage interest rate is 8% per year.
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