Question

The Moto Hotel opened for business on May 1, 2017. Here is its trial balance before adjustment on May 31. MOTO HOTEL Trial Balance May 31, 2017 Debit Credit Cash Supplies Prepaid Insurance $ 2233 2600 1800 14733 67600 Land Buildings Equipment 16800 Accounts Payable $ 4433 Unearned Rent Revenue 3300 Mortgage Payable 33600 Common Stock 59733 Rent Revenue 9000 Salaries and Wages Expense 3000 Utilities Expense 800 Advertising Expense 500 $110066 $110066 Other data: 1. Insurance expires at the rate of $450 per month. 2. A count of supplies shows $1050 of unused supplies on May 31. 3. (a) Annual depreciation is $2760 on the building. (b) Annual depreciation is $2160 on equipment. 4. The mortgage interest rate is 5%. (The mortgage was taken out on May 1.) 5. Unearned rent of $2500 has been earned. 6. Salaries of $820 are accrued and unpaid at May 31.

i got wrong these..

Answer 1

Most common mistakes in T Accounts are:

1. Credit balance accounts entered in Debit columns - like Accumulated Depreciation is credit account, so it should be entered in 2nd column and not the 1st one.

2. All adjusting journal entries should have dates as 5/31. But Opening and Closing balances will have dates as 5/31 Bal.

3. All T accounts given in question has credit balance except for Equipment account (which is correctly done!). All accounts figures should be corrected to 2nd credit column and dates corrected too!

Moto Hotel Reqb TАсcounts Debit Date Credit Date Accumulated Depreciation-Building 5/31 230 5/31 Bal $ 230 Equipment $ 16,800 Accumulated Depreciation-Equipment 5/31 5/31 Bal $ 180 5/31 Bal $ 180 Accounts Payable 5/31 Bal $ 4,433 Unearned Rent Revenue $ 2,500 5/31 Bal 5/31 $ 3,300 5/31 Bal $ 800 Salaries & wages Payable 5/31 $ 820 5/31 Bal $ 820 Interest Payable 5/31 $ 140 5/31 Bal $ 140 Mortgage Payable 5/31 Bal $33,600 5/31 Bal $33,600 Common Stock 5/31 Bal $ 59,733 5/31 Bal $59,733 Rent Revenue 5/31 Bal 5/31 9,000 2,500 5/31 Bal $11,500

Moto Hotel Adjusting Journal entries Req a Debit Credit Calculation No. Account 1 Insurance expense 450 $ 450 Prepaid Insurance $ 1,550 $ 2 Supplies expense -2,600-1,050 Supplies 1,550 -2,760/12 Depreciation expense Accumulated Depreciation-Building За 230 230 -2,160/12 3b Depreciation expense 180 $ Accumulated Depreciation-Equipment 180 33,600*5%*1/12 4 Interest expense 140 Interest Payable 140 $ 2,500 5 Unearned Rent Revenue Rent Revenue 2,500 6 Salaries & wages expense 820 Salaries & wages Payable $ 820

Req c Moto Hotel Adjusted TB Unadjusted TB Adjustments Debit Credit Debit Credit Debit Credit Account Names Cash 2,233 2,233 Supplies 2,600 1,550 1,050 Prepaid Insurance 1,800 450 1,350 Land 14,733 14,733 Builidings 67,600 67,600 Accumulated Depreciation-Building 230 230 16,800 Equipment Accumulated Depreciation-Equipment Accounts Payable 16,800 180 180 4,433 4,433 Unearned Rent Revenue 3,300 2,500 800 Mortgage Payable 33,600 33,600 Salaries & wages Payable Interest Payable 820 820 140 140 Common Stock 59,733 59,733 Retained Earnings 2,500 Rent Revenue 9,000 11,500 Salaries & wages expense 3,000 820 3,820 Utilties expense 800 800 Advertising expense 500 500 Depreciation expense 410 410 Interest expense 140 140 Supplies expense 1,550 1,550 Insurance expense 450 450 Totals 110,066 110,066 5,870 5,870 111,436 111,436

Moto Hotel Income Statement For month ended May 31, 2017 Revenues Rent Revenue 11,500 Expenses Salaries & wages expense 3,820 Utilties expense 800 Advertising expense 500 Depreciation expense 410 Interest expense 140 Supplies expense 1,550 Insurance expense 450 Total Expenses 7,670 Net Income 3,830 Statement of Retained Earnings For month ended May 31, 2017 Retained Earnings, May 1, 2017 Net Income 3,830 Less Dividends Retained Earnings, May 31, 2017 3,830

Moto Hotel Balance Sheet As of May 31, 2017 Assets Current Assets Cash 2,233 Supplies 1,050 Prepaid Insurance 1,350 Total Current Assets 4,633 Fixed Assets Land 14,733 Builidings Accumulated Depreciation-Building 67,600 (230) Buildings, Net 67,370 Equipment 16,800 Accumulated Depreciation-Equipment (180) Equipment, Net 16,620 Net Fixed Assets 98,723 Total Assets 103,356 Liabilities & Stockholders Equity Liabilities Accounts Payable 4,433 Unearned Rent Revenue 800 Salaries&wages Payable Interest Payable 820 140 Mortgage Payable 33,600 Total Liabilities 39,793 Stockholders Equity Common Stock 59,733 Retained Earnings 3,830 Total Stockholders Equity 63,563 Total Liabilities & Stockholders Equity 103,356

Req e	Accounts to be closed
	Rent Revenue
	Salaries & wages expense
	Utilties expense
	Advertising expense
	Depreciation expense
	Interest expense
	Supplies expense
	Insurance expense
	Income Summary