Adjusting Entries
Prepare the necessary adjusting entries at year end of December 31, 2014 for the JS
Corporation for each of the following. No adjusting entries were made during the year.
If no adjustment is needed, state that fact. Round to the nearest dollar.
1. On December 20, 2014, JS received a $4,000 payment from a customer for
services to be rendered early in 2015. Service revenue was credited.
2. On December 1, 2014, JS paid a local radio station $3,000 for 60 radio ads that
were to be aired 20 per month throughout December, January, & February.
Advertising expense was debited.
3. Employee salaries for the month of December totaling $16,000 will be paid on
January 8, 2015.
4. A three year fire insurance policy was purchased on July 1, 2014 for $12,000.
Insurance expense was debited.
5. Depreciation on equipment totaled $15,000 for the year.
6. On August 31, 2014, the company borrowed $60,000 from the bank. A note was
signed with principal and 8% interest to be paid on August 31, 2015.
7. JS began the year with $2,000 in its supplies account. During the year, $6,600 in
supplies were purchased and debited to Supplies Expense. At year end,
supplies costing $3,100 remain on hand.
Adjusting Entries
Prepare the necessary adjusting entries at year end of December 31, 2014 for the JS
Corporation for each of the following. No adjusting entries were made during the year.
If no adjustment is needed, state that fact. Round to the nearest dollar.
1. On December 20, 2014, JS received a $4,000 payment from a customer for
services to be rendered early in 2015. Service revenue was credited.
2. On December 1, 2014, JS paid a local radio station $3,000 for 60 radio ads that
were to be aired 20 per month throughout December, January, & February.
Advertising expense was debited.
3. Employee salaries for the month of December totaling $16,000 will be paid on
January 8, 2015.
4. A three year fire insurance policy was purchased on July 1, 2014 for $12,000.
Insurance expense was debited.
5. Depreciation on equipment totaled $15,000 for the year.
6. On August 31, 2014, the company borrowed $60,000 from the bank. A note was
signed with principal and 8% interest to be paid on August 31, 2015.
7. JS began the year with $2,000 in its supplies account. During the year, $6,600 in
supplies were purchased and debited to Supplies Expense. At year end,
supplies costing $3,100 remain on hand.
JS Corporation | ||||
Adjusting Entries | ||||
Date | Account | Debit | Credit | Calculation |
31-Dec | Service revenue | $ 4,000 | ||
Unearned Service revenue | $ 4,000 | |||
31-Dec | Prepaid Advertising | $ 2,000 | =3,000/3* 2 months | |
Advertising expense | $ 2,000 | |||
31-Dec | Salaries expense | $ 16,000 | ||
Cash | $ 16,000 | |||
31-Dec | Prepaid Insurance | $ 10,000 | =12,000/36*(36-6) | |
Insurance expense | $ 10,000 | |||
31-Dec | Depreciation expense | $ 15,000 | ||
Accumulated Depreciation | $ 15,000 | |||
31-Dec | Interest expense | $ 1,600 | =60,000*8%*4/12 | |
Interest Payable | $ 1,600 | |||
31-Dec | Supplies expense | $ 5,500 | =2,000+6,600-3,100 | |
Supplies | $ 5,500 |
Adjusting Entries Prepare the necessary adjusting entries at year end of December 31, 2014 for the...
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