Question

Howarth Company’s fiscal year-end is December 31. Below are the unadjusted and adjusted trial balances for December 31, 2018.

	Unadjusted							Adjusted
Account Title	Debits			Credits				Debits			Credits
Cash		41,000							41,000
Accounts receivable		26,000							26,000
Prepaid rent		1,575							1,000
Supplies		1,175							700
Inventory		51,000							51,000
Note receivable		49,000							49,000
Interest receivable		0							2,450
Office equipment		36,000							36,000
Accumulated depreciation					15,900							20,600
Accounts payable					25,000							25,000
Salaries and wages payable					0							5,300
Note payable					41,000							41,000
Interest payable					0							1,600
Deferred rent revenue					0							1,100
Common stock					37,000							37,000
Retained earnings					18,900							18,900
Sales revenue					235,000							235,000
Rent revenue					4,200							3,100
Interest revenue					0							2,450
Cost of goods sold		117,000							117,000
Salaries and wages expense		36,900							42,200
Rent expense		10,325							10,900
Depreciation expense		0							4,700
Supplies expense		425							900
Interest expense		4,500							6,100
Advertising expense		2,100							2,100
Totals		377,000			377,000				391,050			391,050

Required:
Prepare the adjusting journal entries that were recorded at December 31, 2018. (If no entry is required for a particular event, select "No journal entry required" in the first account field.)

• Record the adjusting entry for rent expense.

• 2

  Record the adjusting entry for supplies expense.

• 3

  Record the adjusting entry for interest revenue.

• 4

  Record the adjusting entry for depreciation expense.

• 5

  Record the adjusting entry for salaries and wages expense.

• 6

  Record the adjusting entry for interest expense.

• 7

  Record the adjusting entry for deferred rent revenue.

Answer 1

Journal entries

No	Account and explanation	debit	credit
1	Rent expenses	575
	Prepaid rent		575
	(To record rent expenses)
2	Supplies expense	475
	Supplies		475
	(To record supplies expenses)
3	Interest receivable	2450
	Interest revenue		2450
	(To record interest revenue)
4	Depreciation expense	4700
	Accumulated depreciation		4700
	(To record dep)
5	Salaries and wages expenses	5300
	Salaries and wages payable		5300
	(To record salaries and wages expenses)
6	Interest expense	1600
	Interest payable		1600
	(To record interest)
7	Rent revenue	1100
	Deferred rent revenue		1100
	(To record deferred rent revenue)