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Bug- off Exterminators provides pest control services and sells ectermination productos manufactured by other companies.

Following is teh company's unadhusted trial balance as of December 31, 2021:

cash 20,000

accounts receivable 34,450

Allowance for doubtful accounts 858

Merchandise Inventory 16,200

Trucke 47,000

Accumulated depreciation Trucke 0

Equipment 54,000

Accumulated depreciation Equipment 14,750

Accounts Payable 5,750

Estimated warrantly liability 2,150

Unearned service revenue 0

Interest Payable 0

Long term notes payable 30,000

D. Buggge Capital 93,800

D. Bugge Withdrawala 25,000

Ectermination service revenue 90,000

Interest Revenue 902

Sales (of merchandise) 109,826

Cost of good of sold 50,800

Drpreciation exp trucks 0

Depreciation exp equip 0

Wages expense 50,000

Interest expense 0

Rent expense 24,000

Bad debt expense 0

Miscellaneous exp 1,286

Repair Expense 15,500

Utilities expense 9800

Warranty Expense 0

Totals 348,036 348,036

1) The following inf in a though h applies to the company atvthe end of the current year

A) The bank reconciliation as a dec 31, 2021, includes the following facts:

Cash balnce per bank 16,600

cash balance per book 20,000

Outstanding checks 2550

Deposit in transit 3,200

Interest earned( on bank acc) 82

Bank service 30

Reported on the bank statement is a canceled check that the company failed to record. ( inf from the bank reconciliation allows you to determinate the amount of this check, which is a payment on an acc payable)

B) An examination of costumers accounts shows that accounts totaling $694 should be written off as uncollectible. Using an aging of receivables, the company determinates that the ending of the Allowance for Doubtful Accounts should be $775

C) A truck is purchase ans placed in service on January 1, 2021. Its cost is being depreciated with the straight -line method using the following facts and estimates:

Original cost $47,000

Expected salvage value $ 14,000

Useful life (years) 4

D) Two items of equipment ( as sprayer and and injector ) were purchased and put into service in early January 2019. They are being depreciated with the straight -line method using these facts and estimates:

Sprayer Inyector

Origianl cost $30,000 $24,000

Expected salvage value $3,000 $ 4,000

Useful life (years) 8 5

E) On September 1, 2021 the company is paid $20,700 cash in advance to provide montly service for an apartment complex for one year . The company began providing the services in September. When the cash was reveived, the full amount was credited to the Extermination Services Revenue Account.

F) The company offers a warratly for the services it sells. The expected cost of providing warranty service is 2.5%of the extermination services revenue of $76,200 for 2021. No warraty expense has been recordedfor 2021. All cost of servicing warranties in 2021 were properly debited to the Estimated Warraty Liability Account.

G) The $30,000 long -term note is an 8% , 5 years, interest - bearing note with interest payable annually on De ember 31.

The note was signed with First National Bank on December 31,2021.

2) Prepare Journal entries to record the adjustments.Assume Bug-Off 's ajusted balnce for Mercahndise Inventory matches the year- end physical count.

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