Question

(b) The reversing entry for each item where appropriate. No. Account Titles and Explanation Debit Credit 1.

Answer 1

A) The adjusting entry for each item :
Date	General journal	Debit	Credit
Dec-31	Cost of goods sold (1568,000 -1532,400 )	$ 35,600
	Factory overhead		$ 35,600
	(to record under applied overhead to cost of goods sold at the end of year 2017
No	Account Titles and Explanation	Debit	Credit
1)	Insurance Expense             {($ 5,088 /24 months )* 5 months}	$ 1,060
	Prepaid Insurance		$ 1,060
	( To record insurance expired )
2)	Rent Revenue ( $ 1,905 / 3 months )	$ 635
	Rent Receivable		$ 635
	(To record expired )
3)	Advertising Materials Expense {$ 775 - $ 278 }	$ 497
	Advertising Materials		$ 497
	( To record Advertising Materials used )
4)	Interest Expense	$ 805
	Interest Payable		$ 805
	(To record interest on notes payable )

B) The reversing entry for each item where appropriate
No	Account Titles and Explanation	Debit	Credit
1)	No journal entry
	(Reversing entry not appropriate )
2)	Rent Receivable	$ 635
	Rent Revenue ( $ 1,905 / 3 months )		$ 635
	(To reverse the expired rent entry )
3)	Advertising Materials	$ 278
	Advertising Materials Expense		$ 278
	( To record Advertising Materials on hand )
4)	No journal entry
	(Reversing entry not appropriate )