The following transactions occurred during December 31, 2021, for the Microchip Company.
Required:
1. & 2. If Microchip’s accountant employed
reversing entries for accruals, prepare the adjusting entries at
the end of 2021 for only those entries that would be
reversed.
3. Prepare the appropriate reversing entries at
the beginning of 2022.
Requirement 1 & 2 | |||
Transaction | General Journal | Debit | Credit |
1) | Interest receivable [87500*8%*3/12] | 1750 | |
Interest revenue | 1750 | ||
2) | No journal entry required | ||
3) | No journal entry required | ||
4) | No journal entry required | ||
5) | Salaries expense | 6050 | |
Salaries Payable | 6050 | ||
6) | No journal entry required | ||
Requirement 3) | |||
Transaction | General Journal | Debit | Credit |
1) | Interest revenue | $ 1750 | |
Interest receivable | $ 1750 | ||
2) | No journal entry required | ||
3) | No journal entry required | ||
4) | No journal entry required | ||
5) | Salaries Payable | $ 6050 | |
Salaries expense | $ 6050 | ||
6) | No journal entry required |
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