Question

newconnect. meducation.com Assignment 32 Golden Eagle Company Prepares Month Home NCC Help Save & EX Assignment 3.2 Che Consider the following transactions for Huskles Insurance Company 1. Equipment costing $42,000 is purchased at the beginning of the year for cash. Depreciation on the equipment is $7,000 per year. 2. On June 30, the company lends its chief financial officer $50,000 principal and interest at 7% are due in one year. 3. On October 1, the company receives $16,000 from a customer for a one-year property insurance policy. Deferred Revenue is credited 10 points Required: For each item, record the necessary adjusting entry for Huskies Insurance at its year-end of December 31. No adjusting entries were made during the year. (If no entry is required for a particular transaction/event, select "No Journal Entry Required in the first account field. Do not round Intermediate calculations.) View transaction list Journal entry worksheet 3 Equipment costing $42,000 is purchased at the beginning of the year for cash Depreciation on the equipment is $7,000 per year. Record the adjusting entry for depreciation at its year-end of December 31. Hote: Enter debits before credits General Journal Debit Credit December 31

Answer 1

Solution:

Journal Entries - Huskies Insurance company
Event	Particulars	Debit	Credit
1	Depreciation expense Dr	$7,000.00
	To Accumulated depreciation - Equipment		$7,000.00
	(To record depreciation on equipment)
2	Interest receivables Dr ($50,000*7%*6/12)	$1,750.00
	To Interest revenue		$1,750.00
	(To record interest revenue accrued)
3	Deferred revenue Dr ($16,000*3/12)	$4,000.00
	To Service revenue		$4,000.00
	(To record insurance revenue)