Question

C. ADIN C. ADJUSTING JOURNAL ENTRIES (14 Marks) he unadjusted trial balance of Darcy Consulting Services at December 31, Credit Debit $4,HOO 10,400 2.000 1,000 400 16,500 $2,400 Cash Accounts receivable Prepaid insurance Prepaid rent Office supplies Equipment Accumulated depreciation Salaries payable Interest payable Unearned service revenue Note payable Ted Darcy, capital Ted Darcy, drawings Service revenue Salaries expense Depreciation expense Rent expense Insurance expense Office supplies expense Interest expense 600 8,000 15,200 3,000 32,700 20,500 300 $58.900 $58.900 Given the following information above, on the next page prepare the necessary adjusting entries at year end, December 31, 2019, for Darcy Consulting Services. a) A count revealed that $100 of office supplies were still on hand at December 31, 2019. b) The accountant has determined that the prepaid insurance balance at December 31, 2019, should be in the amount of $450. c) The equipment is depreciated at the rate of $200 per month. d) The accountant has determined that the unearned service revenue balance at December 31, 2019, should be in the amount of $350. e) Interest of $200 on the note payable has accrued to the end of the year. f) Salaries accrued at December 31, 2019, amounted to $650. g) The accountant has determined that the prepaid rent balance at December 31, 2019, should be in the amount of $100.

Answer 1

Date	General Journal	Debit	Credit
December 31	Supplies expense	$300
	Supplies		$300
	( To record supplies expense)
December 31	Insurance expense	$1,550
	Prepaid insurance		$1,550
	( To record insurance expense)
December 31	Depreciation expense	$2,400
	Accumulated depreciation - Equipment		$2,400
	( To record depreciation expense)
December 31	Unearned service revenue	$250
	Service revenue		$250
	( To record unearned service revenue)
December 31	Interest expense	$200
	Interest payable		$200
	( To record interest expense)
December 31	Salaries expense	$650
	Salaries payable		$650
	( To record salaries expense)
December 31	Rent expense	$900
	Prepaid rent		$900
	( To record rent expense)

(a) supplies expense = Unadjusted supplies - Ending supplies

= 400-100

= $300

(b) Insurance expense = Unadjusted prepaid insurance - Ending prepaid insurance

= 2,000-450

= $1,550

(c) Depreciation expense = $200 per month

Annual depreciation expense = 200 x 12

= $2,400

(d) Service revenue earned = Unadjusted unearned service revenue - Ending unearned service revenue

= 600-350

= $250

(g) Rent expense = Unadjusted prepaid rent - ending prrepaid rent

= 1,000-100

= $900

Please give a positive rating if you are satisfied with this solution and if you have any query kindly ask.

Thanks!!