Question

Sunland Company, opened an incorporated dental practice on January 1, 2017. During the first month of operations, the following transactions occurred.

1.		Performed services for patients who had dental plan insurance. At January 31, $900 of such services was completed but not yet billed to the insurance companies.
2.		Utility expenses incurred but not paid prior to January 31 totaled $790.
3.		Purchased dental equipment on January 1 for $86,650, paying $22,200 in cash and signing a $64,450, 3-year note payable (interest is paid each December 31). The equipment depreciates $390 per month. Interest is $710 per month.
4.		Purchased a 1-year malpractice insurance policy on January 1 for $24,000.
5.		Purchased $2,210 of dental supplies (recorded as increase to Supplies). On January 31, determined that $590 of supplies were on hand.

Prepare the adjusting entries on January 31. Account titles are Accumulated Depreciation—Equipment, Depreciation Expense, Service Revenue, Accounts Receivable, Insurance Expense, Interest Expense, Interest Payable, Prepaid Insurance, Supplies, Supplies Expense, Utilities Expense, and Accounts Payable. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.)

List of Accounts:

Accounts Payable
Accounts Receivable
Accumulated Depreciation-Buildings
Accumulated Depreciation-Equipment
Advertising Expense
Amortization Expense
Buildings
Cash
Common Stock
Depreciation Expense
Dividends
Equipment
Income Summary
Income Tax Expense
Income Taxes Payable
Insurance Expense
Interest Expense
Interest Payable
Interest Receivable
Interest Revenue
Land
Maintenance and Repairs Expense
Mortgage Payable
No Entry
Notes Payable
Prepaid Advertising
Prepaid Cleaning
Prepaid Insurance
Prepaid Rent
Property Tax Expense
Property Taxes Payable
Rent Expense
Rent Revenue
Retained Earnings
Salaries and Wages Expense
Salaries and Wages Payable
Sales Revenue
Service Revenue
Supplies
Supplies Expense
Ticket Revenue
Unearned Rent Revenue
Unearned Sales Revenue
Unearned Service Revenue
Unearned Ticket Revenue
Utilities Expense
Website

No. Date Account Titles and Explanation Debit Credit 1. Jan. 31 Accounts Receivable 900 Service Revenue 900 2. Jan. 31 Utilities Expense 790 Utilities Payable 790 3. Jan. 31 Depreciation Expense 390 Interest Expense 710 (To record depreciation expense) Accumulated Depreciation -Equipment 390 Interest Payable 710 (To record interest expense) 4. Jan. 31 Insurance Expense 2000 Prepaid Insurance 2000 5. Jan. 31 Supplies Expense 1620 Supplies 1620

Answer 1

Solution:

Journal Entries

No	Date	Particulars	Debit($)	Credit($)
2	Jan 31	Utilities expense A/c Dr	$790
		To Utilities payable A/c		$790
3	Jan 31	Depreciation expense A/c Dr	$390
		To Accumulated depreciation - Equipment A/c		$390
		(To record depreciation expense)
		Interest expense A/c Dr	$710
		To Interest payable A/c		$710
		(To record interest expense)