Question

On March 31, the following data were accumulated to assist the accountant in preparing the adjusting entries for Potomac Realty The supplies account balance on March 31 is $5,620, the supplies on hand on March 31 are $1,290 . The uneamed rent account balance on March 31 is $5,000 representing the receipt of an advance payment on March 1 of four months rent from tenants .Wages accrued but not paid at March 31 are $2,290 . Fees accrued but unbilled at March 31 are $16,825 Depreciation of office equipment is $4,600 Required: 1 Journalize the adjusting entnes requred at March 31 Refer to the Chart of Accounts for exact wording of account tities 2 What is the difference between adjusting entries and correcting entries?

Answer 1

Date	Description	Post. Ref.	Debit	Credit	Assets	Liabilities	Equity
March 31	Supplies Expense		4330				↓
	Supplies			4330	↓
March 31	Unearned Rent		1250			↓
	Rent Revenue			1250			↑
March 31	Wages Expense		2290				↓
	Wages Payable			2290		↑
March 31	Accounts Receivable		16825		↑
	Fees Earned			16825			↑
March 31	Depreciation Expense		4600				↓
	Accumulated Depreciation-Office Equipment			4600	↓
2
Adjusting entries are a planned part of the accounting process to update the accounts. Correcting entries are not planned, but arise only when
necessary to correct errors.