Question

Week 4 – Assignment Question A: 1] Collected $1,000 rent for the period December 1, 2012, to April 1, 2013, which was credited to Unearned Rent Revenue on December 1, 2012. 2] Purchased a machine for $32,000 cash on January 1, 2008. The company estimates annual depreciation at $3,000. 3] Paid $4,200 for a two-year insurance premium on July 1, 2012; debited Prepaid Insurance for that amount. Instruction: Please make and adjusted transactions Questions B: Determining Financial Statement Effects of Adjusting Entries (Deferred Accounts) For each of the transactions above, indicate the amounts and direction of effects of the adjusting entry on the elements of the balance sheet and income statement. Using the following format, indicate + for increase, − for decrease, and NE for no effect. Balance Sheet Income Statement Transaction Assets Liabilities Stockholders’ Equity Revenue Expenses Net Income A B C

Answer 1

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Transaction	Working	Asset	Liabilities	Stockholder Equity	Revenue	Expense	Net Income
1	For Dec, revenue earned		$   -1,000		$    1,000		$        1,000
2			$    3,000			$    3,000	$       -3,000
3	4200/24 Months*6 Months	$   -1,050				$    1,050	$       -1,050
Total		$   -1,050	$    2,000	$                          -	$    1,000	$    4,050	$       -3,050