Bug-Off Exterminators provides pest control services and sellsextermination products manufactured by other companies. Followingis the company's unadjusted trial balance as of December 31, 2019.December 31, 2019 Unadjusted Trial Balance Cash $ 20,000 Accountsreceivable 5,500 Allowance for doubtful accounts $ 858 Merchandiseinventory 16,200 Trucks 47,000 Accum. depreciation—Trucks 0Equipment 92,400 Accum. depreciation—Equipment 24,200 Accountspayable 5,750 Estimated warranty liability 2,150 Unearned servicesrevenue 0 Interest payable 0 Long-term notes payable 30,000 Commonstock 25,000 Retained earnings 68,800 Dividends 25,000Extermination services revenue 90,000 Interest revenue 902 Sales(of merchandise) 109,826 Cost of goods sold 50,800 Depreciationexpense—Trucks 0 Depreciation expense—Equipment 0 Wages expense50,000 Interest expense 0 Rent expense 24,000 Bad debts expense 0Miscellaneous expense 1,286 Repairs expense 15,500 Utilitiesexpense 9,800 Warranty expense 0 Totals $ 357,486 $ 357,486 Thefollowing information in a through h applies to the company at theend of the current year. The bank reconciliation as of December 31,2019, includes the following facts. Cash balance per bank $ 16,600Cash balance per books 20,000 Outstanding checks 2,550 Deposit intransit 3,200 Interest earned (on bank account) 82 Bank servicecharges (miscellaneous expense) 30 Reported on the bank statementis a canceled check that the company failed to record. (Informationfrom the bank reconciliation allows you to determine the amount ofthis check, which is a payment on an account payable.) Anexamination of customers’ accounts shows that accounts totaling$694 should be written off as uncollectible. Using an aging ofreceivables, the company determines that the ending balance of theAllowance for Doubtful Accounts should be $775. A truck ispurchased and placed in service on January 1, 2019. Its cost isbeing depreciated with the straight-line method using the followingfacts and estimates. Original cost $ 39,500 Expected salvage value$ 14,000 Useful life (years) 4 Two items of equipment (a sprayerand an injector) were purchased and put into service in earlyJanuary 2017. They are being depreciated with the straight-linemethod using these facts and estimates. Sprayer Injector Originalcost $ 39,000 $ 21,000 Expected salvage value $ 3,000 $ 4,000Useful life (years) 8 5 On September 1, 2019, the company is paid$20,700 cash in advance to provide monthly service for an apartmentcomplex for one year. The company began providing the services inSeptember. When the cash was received, the full amount was creditedto the Extermination Services Revenue account. The company offers awarranty for the services it sells. The expected cost of providingwarranty service is 2.5% of the extermination services revenue of$76,200 for 2019. No warranty expense has been recorded for 2019.All costs of servicing warranties in 2019 were properly debited tothe Estimated Warranty Liability account. The $22,500 long-termnote is an 8%, five-year, interest-bearing note with interestpayable annually on December 31. The note was signed with FirstNational Bank on December 31, 2019. The ending inventory ofmerchandise is counted and determined to have a cost of $16,200.Bug-Off uses a perpetual inventory system. Required: 1. Determineamounts for the following items: Correct (reconciled) endingbalance of Cash; and the amount of the omitted check. Adjustmentneeded to obtain the correct ending balance of the Allowance forDoubtful Accounts. Depreciation expense for the truck used duringyear 2019. Depreciation expense for the two items of equipment usedduring year 2019. The adjusted 2019 ending balances of theExtermination Services Revenue and Unearned Services Revenueaccounts. The adjusted 2019 ending balances of the accounts forWarranty Expense and Estimated Warranty Liability. The adjusted2019 ending balances of the accounts for Interest Expense andInterest Payable. 2. Use the results of part 1 to complete thesix-column table by first entering the appropriate adjustments foritems a through g and then completing the adjusted trial balancecolumns. Hint: Item b requires two adjustments. 3. Prepare journalentries to record the adjustments entered on the six-column table.Assume Bug-Off’s adjusted balance for Merchandise Inventory matchesthe year-end physical count. 4a. Prepare a single-step incomestatement for year 2019. 4b. Prepare the statement of retainedearnings (cash dividends during 2019 were $25,000) for 2019. 4c.Prepare a classified balance sheet as at 2019.