Question

Exercise 4-9

The ledger of Tamarisk, Inc. on March 31 of the current year includes the selected accounts below before adjusting entries have been prepared.

		Debit		Credit
Supplies		$3,870
Prepaid Insurance		3,780
Equipment		25,800
Accumulated Depreciation—Equipment				$7,740
Notes Payable				21,600
Unearned Rent Revenue				10,650
Rent Revenue				60,500
Interest Expense		0
Salaries and Wages Expense		12,100

An analysis of the accounts shows the following.

1.		The equipment depreciates $360 per month.
2.		Half of the unearned rent revenue was earned during the quarter.
3.		Interest of $470 is accrued on the notes payable.
4.		Supplies on hand total $940.
5.		Insurance expires at the rate of $420 per month.

Prepare the adjusting entries at March 31, assuming that adjusting entries are made quarterly. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.)

No.	Date	Account Titles and Explanation	Debit	Credit
1.	Mar. 31	enter an account title to record the first transaction	Enter a debit amount	Enter a credit amount
		enter an account title to record the first transaction	Enter a debit amount	Enter a credit amount
2.	Mar. 31	enter an account title to record the second transaction	Enter a debit amount	Enter a credit amount
		enter an account title to record the second transaction	Enter a debit amount	Enter a credit amount
3.	Mar. 31	enter an account title to record the third transaction	Enter a debit amount	Enter a credit amount
		enter an account title to record the third transaction	Enter a debit amount	Enter a credit amount
4.	Mar. 31	enter an account title to record the fourth transaction	Enter a debit amount	Enter a credit amount
		enter an account title to record the fourth transaction	Enter a debit amount	Enter a credit amount
5.	Mar. 31	enter an account title to record the fifth transaction	Enter a debit amount	Enter a credit amount
		enter an account title to record the fifth transaction	Enter a debit amount	Enter a credit amount

Answer 1

1	Depreciation expense	1080
	Accumulated Depreciation - Equipment		1080
	(360*3)
2	Unearned rent revenue	5325
	Rent revenue		5325
	(10650/2)
3	Interest expense	470
	Interest payable		470
4	Supplies Expense	2930
	Supplies		2930
	(3870-940)
5	Insurance expense	1260
	Prepaid Insurance		1260
	(420*3)