Question

Problem 3-01A a-c 

Donna Clark started her own consulting firm, Clark Consulting, on May 1, 2020. The trial balance at May 31 is as follows. 

CLARK CONSULTING Trial Balance May 31, 2020

In addition to those accounts listed on the trial balance, the chart of accounts for Clark Consulting also contains the following accounts and account numbers: No. 150 Accumulated Depreciation-Equipment, No. 212 Salaries and Wages Payable, No. 631 Supplies Expense. No. 717 Depreciation Expense, No. 722 Insurance Expense, and No. 732 Utilities Expense. 

Other data: 

1 $1,000 of supplies have been used during the month. 

2 Utilities expense incurred but not paid on May 31, 2020, $300. 

3 The insurance policy is for 2 years. 

4 $500 of the balance in the unearned service revenue account remains unearned at the end of the month. 

5 May 31 is a Wednesday, and employees are paid on Fridays. Clark Consulting has two employees, who are paid $1,100 each for a 5-day work week. 

6 The office furniture has a 5-year life with no salvage value. It is being depreciated at $200 per month for 60 months. 

7 Invoices representing $1,600 of services performed during the month have not been recorded as of May 31. 

Prepare the adjusting entries for the month of May.

Answer 1

Adjusting Entries

No.	Date	Account Titles and explanations	Ref.	Debit	Credit
1	May-31	Supplies Expense	631	1000
		Supplies	126		1000
2	May-31	Utilities Expense	732	300
		Accounts Payable	201		300
3	May-31	Insurance Expense	722	100
		Prepaid Insurance	130		100
4	May-31	Unearned Service Revenue	209	1500
		Service Revenue	400		1500
5	May-31	Salaries and Wages Expense	726	1320
		Salaries and Wages Payable	212		1320
6	May-31	Depreciation Expense	717	200
		Accumulated Depreciation - Equipment	150		200
7	May-31	Accounts Receivable	112	1600
		Service Revenue	400		1600

Ledger Accounts

Cash				No. 101
Date	Explanations	Debit	Credit	Balance
May-31	Balance			4700
Accounts Receivable				No. 112
Date	Explanations	Debit	Credit	Balance
May-31	Balance			5900
May-31	Adjusting	1600		7500
Supplies				No. 126
Date	Explanations	Debit	Credit	Balance
May-31	Balance			2000
May-31	Adjusting		1000	1000
Prepaid Insurance				No. 130
Date	Explanations	Debit	Credit	Balance
May-31	Balance			2400
May-31	Adjusting		100	2300
Equipment				No. 149
Date	Explanations	Debit	Credit	Balance
May-31	Balance			12000
Accounts Payable				No. 201
Date	Explanations	Debit	Credit	Balance
May-31	Balance			4600
May-31	Adjusting		300	4900
Unearned Service Revenue				No. 209
Date	Explanations	Debit	Credit	Balance
May-31	Balance			2000
May-31	Adjusting	1500		500
Owner's Capital				No. 301
Date	Explanations	Debit	Credit	Balance
May-31	Balance			16800
Service Revenue				No. 400
Date	Explanations	Debit	Credit	Balance
May-31	Balance			8100
May-31	Adjusting		1500	9600
May-31	Adjusting		1600	11200
Salaries and wages Expenses				No. 726
Date	Explanations	Debit	Credit	Balance
May-31	Balance			3400
May-31	Adjusting	1320		4720
Rent Expenses				No. 729
Date	Explanations	Debit	Credit	Balance
May-31	Balance			1100
Supplies Expense				No. 631
Date	Explanations	Debit	Credit	Balance
May-31	Adjusting	1000		1000
Utilities Expense				No. 732
Date	Explanations	Debit	Credit	Balance
May-31	Adjusting	300		300
Insurance Expense				No. 722
Date	Explanations	Debit	Credit	Balance
May-31	Adjusting	100		100
Salaries and Wages Payable				No. 212
Date	Explanations	Debit	Credit	Balance
May-31	Adjusting		1320	1320
Depreciation Expense				No. 717
Date	Explanations	Debit	Credit	Balance
May-31	Adjusting	200		200
Accumulated Depreciation - Equipment				No. 150
Date	Explanations	Debit	Credit	Balance
May-31	Adjusting		200	200