Question

Helpppp......I think I am doing this so wrong.

Fill in the t-accounts for each situation and label each transaction as Deferrals/Prepaid or Accrual. Calculate the adjusted balance and use a Bal. post reference to show the ending balance of each account. Employees earned $2,900 in salaries that wll be paid next month. The Salaries Expense unadjusted balance as of December 31 is $5,700 Adjustment Type Accrual Salaries Expense Salaries Payable Dec. 31 2,900 8600 Dec. 31 Dec. 31 2,900 2,900 Dec. 31 Dec. 31 5,700 Bal. 8600 8600 Ba Bal. 2,900 2,900 Bal. A two year insurance policy for $1,320 was purchased on November 1 of the current year. Record the transaction for the year ended December 31 Adjustment TypeDeferrals/Prepaids Insurance Expense Prepaid Insurance Incurred interest expense of $3,600. Adjustment Type Accrual Interest Expense Interest Payable

Answer 1

Part 1

Adjustment Type:

Accrual

Salaries Expense

Bal.	5700
Dec.31	2900
Bal.	8600

Salaries payable

		2900	Dec. 31
		2900	Bal.

Entry will be:

date	Accounts title	debit	credit
Dec.31	Salaries expense	2900
	Salaries payable		2900

Part 2

Adjustment Type:

Deferrels prepaid

Insurance Expense

Dec.31	110
Bal.	110

Prepaid insurance

Nov. 1	1320	110	Dec. 31
Bal.	1210

Entries will be:

date	Accounts title	debit	credit
Nov. 1	Prepaid insurance	1320
	cash		1320

date	Accounts title	debit	credit
Dec.31	Insurance expense	110
	Prepaid insurance (1320*2/24)		110

Part 3

Adjustment Type:

Accrual

Interest Expense

Dec.31	3600
Bal.	110

Interest payable

		3600	Dec. 31
		3600	Bal.

Entry will be:

date	Accounts title	debit	credit
Dec.31	Interest expense	3600
	interest payable		3600