Question

TULL SCREEN PRINTER VERSION 4 BLACK NEX Problem 3-03A Demello & Associates records adjusting entries on an annual basis. The company has the following information available on accruals that must be recorded for the year ended December 31, 2021: 1. Demello has a $13,200,6% note receivable with a customer. The customer pays the interest on a monthly basis on the first of the month. Assume the customer pays the correct amount each month. 2. Demello pays its employees a total of $6,200 every second Wednesday. Employees work a five-day week, Monday to Friday, and are paid for all statutory holidays. December 31, 2021, is a Friday. Employees were paid on Wednesday, December 29, 2021, up to the Friday of the prior week. 3. Demello has a contract with a customer where it provides services prior to billing the customer. On December 31, 2021, this customer owed Demello $3,330. Demello billed the customer on January 7, 2022, and collected the full amount on January 18, 2022 4. Demello received the $515 December utility bill on January 10, 2022. The bill was paid on its due date, January 22, 2022 5. Demello has a $25,200,6% note payable. Interest is paid every six months, on October 31 and April 30. Assume that Demello made the correct interest payment on April 30, 2021, and October 31, 2021. Prepare the adjusting journal entries required on December 31, 2021. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter o for the amounts. Round answers to the nearest whole dollar, e.g. 5,275.) Debit Credit No. Date Account Titles and Explanation 1. Dec. 31 2. Dec 31 3. Dec. 31 Policy 1 2000-2020 John Wiley & Sons, Inc. All Rights Reserved. A Division of John Wiley & Sons Version 4.24.2

Answer 1

S. No.	Date	Account titles and explanation	Debit	Credit
1	Dec 31	Cash A/c	66
		Interest received A/c		66
		(Being interest received in cash)
2	Dec 29	Payroll expenses A/c	6,200
		Cash A/c		6,200
		(Beingpayroll paid in cash)
3	Dec 31	No entry required	0
				0
4	Dec 31	No entry required	0
				0
5	Jan 18	Cash A/c	3330
		Accounts receivable A/c		3330
		(Being amount collected)
6	Jan 22	Utility Expenses A/c	515
		Cash A/c		515
		(Being utility bill paid)
7	Apr 30	Interest expense A/c	756
		Cash A/c		756
		(Being interest paid in cash)
8	Oct 31	Interest expense A/c	756
		Cash A/c		756
		(Being interest paid in cash)