Presented Below Is an Adjusted Trial Balance for Shawn Company

question 115

Essay

Presented below is an adjusted trial balance for Shawn Company at December 31 2016. $$\begin{array} { l r l r } \text { Cash } & \$ 7,700 & \text { Accounts payable } & \$ 10,000 \\\text { Accounts receivable } & 20,000 & \text { Notes payable } & 9,000 \\\text { Prepaid insurance } & 15,000 & \text { Accumulated depreciation- } & \\\text { Equipment } & 35,000 & \text { Equipment } & 14,000 \\\text { Depreciation expense } & 7,000 & \text { Service revenue } & 29,000 \\\text { Owner's Drawings } & 1,500 & \text { Owner's capital } & 24,000 \\\text { Advertising expense } & 1,400 & \text { Unearned service revenue } & 16,000 \\\text { Rent expense } & 800 & & \\\text { Salaries and wages expense } & 12,000 & & \\\text { Insurance expense } & 1,600 & \\& \underline { 102,000 }&& \underline { 102,000 } \end{array}$$ Instructions
(a) Prepare closing entries for December 31 2016.
(b) Determine the balance in the Owner's Capital account after the entries have been posted.

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Definitions:

Proximate Cause

A legal concept that refers to the primary cause of an injury or damage in tort law, without which the injury or damage would not have occurred.

Cause in Fact

An element in tort law that establishes a direct connection between the defendant's conduct and the harm suffered by the plaintiff.

Compensable Loss

A financial loss for which one can receive compensation, often through insurance or litigation.

Duty of Care

A duty mandated by law placed on a person to exercise reasonable care in actions that might predictably injure other people.