Question

l Digi 4G 17:45 78%- online.vitalsource.com P3-36A Journalizing and posting adjustments to the four-column accounts and preparing an adjusted trial balance The unadjusted trial balance of Newport Inn Company at December 31, 2016, and the data needed for the adjustments follow. NEWPORT INN COMPANY Trial Balance December 31, 2016 Account Title Cash Accounts Receivable Prepaid Insurance Office Supplies Building Debit S 11,900 13,900 3,500 1,100 515,000 350,000 4,500 Accounts Payable Salaries Payable Unearned Revenue Coffey, Capital Coffey Withdrawals Service Revenue Salaries Expense Insurance Expense 2,500 175,620 2,170 2500 18.200 Advertising Expense Supplies Expense Total 750 550,820 550,820

Answer 1

1
Date	Accounst titles & Explanation	Debit	Credit
December 31	Insurance Expenses	2,900
	Prepaid Insurance		2,900
December 31	Supplies Expenses	400
	Office Supplies		400
December 31	Depreciation Expenses - Building	3,500
	Acc. Depreciation - Building		3,500
December 31	Salaries Expenses	900
	Salaries Payable		900
	($1,500 x 3/5)
December 31	Unearned Revenue	1,000
	Service Revenue		1,000
					(figure in $)
3	NEWPORT INN COMPANY
	December 31, 2016
		Unadjustment		Adjustment		Adjusted
	Account Name	Debit	Credit	Debit	Credit	Debit	Credit
	Cash	11,900				11,900
	Accounts Receivable	13,900				13,900
	Prepaid Insurance	3,500			2,900	600
	Office Supplies	1,100			400	700
	Building	515,000				515,000
	Acc. Depreciation - Building		350,000		3,500		353,500
	Accounts Payable		4,500				4,500
	Salaries Payable				900		900
	Unearned Revenue		2,500	1,000			1,500
	Coffey, Capital		175,620				175,620
	Coffey, Drawing	2,170				2,170
	Service Revenue		18,200		1,000		19,200
	Salaries Expenses	2,500		900		3,400
	Insurance Expenses			2,900		2,900
	Depreciation Expenses - Building			3,500		3,500
	Advertising Expenses	750
	Supplies Expenses			400		400
		550,820	550,820	8,700	8,700	554,470	555,220
4	No, Even the adjusted trial balance has total debits equal to total credits, this does not mean
	that the adjusting entries have been recorded correctly. For example if a adjusting entry made
	wrong accounts then may be adjusted trial balance having debits and credits are equal but
	but this does not mean that the adjusting entry is recorded correctly. Suppose depreciation on
	building are due on year end but the deprecaition entry made for equipment then adjusted
	trail balance will match, but the adjusting entries is not correct.