Question

All the accounts have normal balances. The information below has been gathered at December 31, 2015. 1. Verne Cova Company borrowed $10,125 by signing a 12%, one-year note on September 1, 2015. 2. A count of supplies on December 31, 2015, indicates that supplies of $839 are on hand. 3. Depreciation on the equipment for 2015 is $1,135. Verne Cova Company paid $2,280 for 12 months of insurance coverage on June 1, 2015. 5. On December 1, 2015, Verne Cova collected $28,000 for consulting services to be performed from December 1, 2015, through March 31, 2016. 6. Verne Cova performed consulting services for a client in December 2015. The client will be billed $3,701. 7. Verne Cova Company pays its employees total salaries of $5,580 every Monday for the preceding 5-day week (Monday through Friday). On Monday, December 29, employees were paid for the week ending December 26. All employees worked the last 3 days of 2015. Prepare adjusting entries for the seven items described above. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.) No. Account Titles and Explanation Debit Credit 1.

Answer 1

Account titles and explanation		Debit(in $)	Credit(in $)
Interest expenses($10,125*12%*4/12)		405
Interest Payable			405
Supplies expenses		1,229
Supplies			1,229
Depreciation expenses		1,135
Accumulated Depreciation-Equipment			1,135
Inurance expenses($2,280*7/12)		1,330
Insurance Payable			1,330
Unearned service Revenue($28,000*1/4)		7,000
Service Revenue			7,000
Accounts Receivable		3,701
Service Revenue			3,701
Salary and Wages expenses[($5,580/5 days)*3 days		3,348
Salary and Wages payable			3,348