Question

The trial balance of Neal Company as of January 31, 2019, after the company completed the first month of operations, is shown in the partial worksheet below. Required: 2. Complete the worksheet by making the following adjustments: supplies on hand at the end of the month $7,400, expired insurance, $7,100; depreciation expense for the period, $3,200. Analyze: How does the insurance adjustment affect Prepaid Insurance? Complete this question by entering your answers in the tabs below. Partial Worksheet Analyze Complete the worksheet by making the following adjustments: supplies on hand at the end of the month, $7,400; expired insurance, $7,100; de NEAL COMPANY Worksheet (Partial) Month Ended January 31, 2019 Adjustments Adjusted Trial Balance Debit Credit Debit Credit Income Account Name $ Cash Accounts Receivable Supplies Prenaid Insurance Trial Balance Debit Credit 103,400 20,200 37,800 56 4001

Answer 1

Please give positive ratings so I can keep answering. It would help me a lot. Please comment if you have any query. Thanks!

Alexander Neal
Work Sheet	Unadjusted	Adjustments	Adjusted	Income Statement	Balance Sheet	Remarks
Account Titles	Debit	Credit	Debit	Credit	Debit	Credit	Debit	Credit	Debit	Credit
Cash	103,400.00				103,400.00				103,400.00
Accounts Receivable	20,200.00				20,200.00				20,200.00
Supplies	37,800.00			30,400.00	7,400.00				7,400.00		Supplies on hand at year-end, $7,400. So $ 30,400 consumed.
Prepaid Insurance	56,400.00			7,100.00	49,300.00				49,300.00		Expired Insurance $ 7,100.
Equipment	107,400.00				107,400.00				107,400.00
Accumulated Depreciation- Equipment				3,200.00		3,200.00				3,200.00	Depreciation on equipment for current period $ 3,200.
Accounts Payable		24,200.00				24,200.00				24,200.00
Alexander Neal, Capital		251,400.00				251,400.00				251,400.00
Alexander Neal, Drawings	13,800.00				13,800.00				13,800.00
Fees Income		96,600.00				96,600.00		96,600.00
Supplies Expense			30,400.00		30,400.00		30,400.00				Supplies on hand at year-end, $7,400. So $ 30,400 consumed.
Insurance Expense			7,100.00		7,100.00		7,100.00				Expired Insurance $ 7,100.
Salaries Expense	30,600.00				30,600.00		30,600.00
Depreciation- Equipment			3,200.00		3,200.00		3,200.00				Depreciation on equipment for current period $ 3,200.
Utilities Expense	2,600.00				2,600.00		2,600.00
Sub Totals	372,200.00	372,200.00	40,700.00	40,700.00	375,400.00	375,400.00	73,900.00	96,600.00	301,500.00	278,800.00
Net Income							22,700.00			22,700.00
Totals							96,600.00	96,600.00	301,500.00	301,500.00
How does the insurance adjustment affect prepaid insurance?
Total prepaid insurance was $ 56,400. But $ 7,100 was expired during the year which this has to be booked as expense. So Prepaid Insurance will be reduced by $ 7,100 and closing balance will be $ 49,300.