Question

Make the following adjusting entries at the year end (31" December) 1) On 01.06. collected rent in advance for one year - $6,000 cash 2) Owe interest expense of $900 to be paid on 15.01 3) Hold a NR on which $700 interest revenue was earned but not received 4) Pay $5,000 salaries for 5-day work week every Friday. 31.12 is Wednesday 5) Unadjusted balance of supplies is $3,100. Physical count shows supplies on hand for $1,200 6) Purchased equipment on 01.01 for $10,000. Useful life will be 4 years. 7) On 01.09 paid insurance for the following 2 years - $1,800

Answer 1

Entries at the year End Adjusting 21st Decembera 1 on 01.06 for rent collected in advance - $6000 Dr Cash To the Rental - $600D Income Ale on 3112, Adjusting Entries - or Dr $2500 e Rental encome encome al the - To Rent Received in Advance $2500 Al fraidbe o desse sabe o $2500 Rental income To profit the Dr & loss Ale $3.500 2) on 31.12 , Adjusting Entry for Accrued interest expense I profit & loss Ale Dr $900 - To Acormed Interest Ale $900 Payable 3.) on 31.12 Adjusting Entry for interest earned but not recared Accrued Interest Income Ale Dr $700 To profit ę loss Ale $700

4.) on 31.12 Adjusting not paid using Entry Entry for for salary salary expense profit To Ę loss the Salary payable DV the $2000 $2000 5.) on 3112, Adjusting Entry for Supplies - Profit & Loss Ale or $3,100 To purchases (supplies the $1200 To Loss of stock 6.) on 3112 Adjusting Entry for Equipment purchased profit Ę Loss Ale pr $2500 $ 2500 TO Depreciation the $1900 7.) on 31.12, Adjusting Entry prepaid Insurance - To Insurance for Ale Ale prepaid or Insurance. I $1500 $1500 or $300 profit & loss Ale To Insurance Ale

Notes': 1. Rent Received in Adrance - $ 6000 Reut pertaining to current year = $60004 7/12 = 93500 Reut received for next year fire pro Reut recewed in Advance ] . $6000 75/12 = $2500 2. Interest payable on 15.01 ix accrued and payable to be charged to profit & 1o88 Ale. g. Interest in come and recewable earned but not recewed is acemed to be shown in profit & loss Ale. 4. Salary Expense for s-day work week = $5,000 31.12 is wednesday, so 3 day work expense- $3,000 to be changed to profit & loss Alc. 5. unadjusted Supplies $3,100 physical count in Hand $1200 Loos of supplies & 1900 6. Equipment $10,000 Depreciatias = 10,000 = $ 2500 T Equipment value to be shown in Balance sheet $7,500 + I Insurance Insurance prepard for 2 years for current Insurance a paid on year $1500 01:09. $1800x 4m - $300 Zum af