The following adjusted trial balance contains the accounts and year-end balances of Cruz Company as of December 31. No. Account Title Debit Credit 101
Cash $ 18,000 126
Supplies 9,600 128
Prepaid insurance 2,000 167
Equipment 23,000 168
Accumulated depreciation—Equipment $ 6,500 301
A. Cruz, Capital 40,872 302
A. Cruz, Withdrawals 6,000 404
Services revenue 48,100 612
Depreciation expense—Equipment 2,000 622
Salaries expense 28,042 637
Insurance expense 2,020 640
Rent expense 3,223 652
Supplies expense 1,587
Totals $ 95,472 $ 95,472
1. Prepare the December 31, closing entries for Cruz Company. Assume the account number for Income Summary is 901.
2. Prepare the December 31, post-closing trial balance for Cruz Company. Note: A. Cruz, Capital was $40,872 on December 31 of the prior year.

Suppose that jim plans to borrow money for an education at texas a& m university. jim will need to borrow $25,000 at the end of each year for the next five years (total=$125,000). jim wishes his parents could pay for his education but they can’t. at least, he qualifies for government loans with a reduced interest rate while he is in school. he has a special arrangement with aggiebank to lend him the money at a subsidized rate of 1% over five years without having to make a payment until the end of the fifth year. however, at the end of the fifth year, jim agrees to pay off the loan by borrowing from longhorn bank. longhorn bank will lend him the money he needs at an annual interest rate of 6%. jim agrees to pay back the longhorn bank with 20 annual payments and the payments will be uniform (equal annual payments including principal and interest). (i) calculate how much money jim has to borrow at the end of 5 years to pay off the loan with aggiebank. a. $121,336 b. $127,525 c. $125,000 d. $102,020 e. none of the above