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Problem 1 Adjusting Entries- Fun-Time Excursions provides rafting trips on the Colorado River. Below is the unadjusted trial balance as of December 31 follows, along with descriptions (on the next page) of items a through g that require adjusting entries on December 31. a. You reviewed the company's insurance policies and determined the $2,600 of the insurance coverage has expired (been used up). b. You counted the amount of excursion supplies still here, that amounted to $2,318. c. You calculated annual depreciation on the equipment $10,698. d. You calculated annual depreciation on the rafts of $5,349. e. On September 1, Fun-time agreed to do five rafting courses for a client for $2,400 each. Two trips will happen this year. Three trips are scheduled for next year. The client paid $12,000 cash in advance for all five trips on September 1, and Fun-Times credited Unearned Revenue. f. The company has 3 employees, who each earn $100 in salaries each working day. They are paid each Monday for their work in the five-day workweek ending on the previous Friday. Assume that December 31 is a Tuesday, and all 3 employees worked the first two days of that week. Because New Year's Day is a paid holiday, they will be paid salaries for five full days on Monday, January 6 of next year. g. The balance in the Prepaid Rent account represents rent for December. Prepare the adjusting entries required by the above information. Problem # 2 - Financial Statements -The adjusted trial balance for Madden Enterprises as of December 31 fallowe Required: Use the information in the adjusted trial balance to prepare the following financial statements. Please remember proper headings for your statements: (a) the income statement for the year ended December 31 (net income will =$154,600 ). (b) the statement of owner's equity for the year ended December 31. A. Madden, Capital on December 31 of the prior year was $511,600, and there were no owner investments in the current year; and (c) the balance sheet as of December 31 - refer to Exhibit 3.14 on page 98 of your text for an example of the presentation for accumulated depreciation. (total assets will =$1,316,200 )

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