A six-column table for Daxu Consulting Company follows.

A six-column table for Daxu Consulting Company follows. The first two columns contain the unadjusted trial balance for the company as of December 31, 2002, and the last two columns contain the adjusted trial balance as of the same date.AccountUnadjustedTrial BalanceAdjustmentsAdustedTrial BalanceCash$56,000$56,000Accounts Receivable40,00047,500Office Supplies35,00015,000Prepaid Insurance7,6005,000Office Equipment120,000120,000Accumulated Depr.-Office Equipment$25,000$35,000Accounts Payable32,00040,000Interest Payable-0-2,350Salaries Payable-0-15,000Unearned Consulting Fees26,00020,000Long-Term Notes Payable60,00060,000Common Stock30,00030,000Retained Earnings46,00046,000Consulting Fees Earned236,200249,700Depr. Expense – Office Equip.-0-10,000Salaries Expense112,000127,000Interest Expense7,6009,950Insurance Expense-0-2,600Rent Expense40,00040,000Office Supplies Expense-0-20,000Advertising Expense37,00045,000Totals$455,200$455,200$498,050$498,050Required:Analysis ComponentAnalyze the differences between the unadjusted and adjusted trial balances to determine the adjustments that must have been made. Show the results of your analysis by inserting these adjustment amounts in the table’s two middle columns. Label each adjustment with a letter and provide a short description of it.Preparation ComponentUse the information in the adjusted trial balance to prepare this company’s (a) income statement and statement of retained earnings for the year ended December 31, 2002 (Note: retained earnings at December 31, 2001 were $56,000, and the current-year dividends were $10,000), and (b) the balance sheet as of December 31, 2002.Calculate the company’s Profit Margin for the year ended December 31, 2002.

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