Question

The Righter Shoe Store Company prepares monthly financial statements for its bank. The November 30 and December 31, 2021, trial balances contained the following account information: Supplies Prepaid insurance Salarios payable Deferred rent revenue - Nov. 30 -- Dec. 31 Dr. Cr. Dr. Cr. 3,200 4,700 7,700 5,350 18,500 16,700 5,400 2,700 The following information also is known: a. The December income statement reported $3,700 in supplies expense. b. No insurance payments were made in December. c. $18,500 was paid to employees during December for salaries d. On November 1, 2021, a tenant paid Righter $8,100 in advance rent for the period November through January. Deferred rent revenue was credited. Required: 1. Using the above information for December, complete the T-accounts below. The beginning balances should be the balances as of November 30. 2. Using the above information, prepare the adjusting entries Righter recorded for the month of December. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Using the above information for December, complete the T-accounts below. The beginning balances should be the balances as of November 30 Supplies Prepaid Insurance Beg Bal Beg. Bal End. Bal End. Bal. Salarles Payable Deferred Rent Revenue Beg Bal Beg Bal End Bal End. Bal Required 1 Required 2 >

Answer 1

1.) Supplies:

Beg Bal - 3200

End Bal - 4700

Prepaid Insurance:

Beg Bal- 7700

End Bal - 5350

Salaries Payable :

Beg Bal - 18500

End Bal- 16700

Deferred Rent Revenue:

Beg Bal - 5400

End Bal - 2700

2) Adjusting entries:

Profit & Loss a/c Dr. 2350 (7700-5350)

To Prepaid Insurance a/c 2350

( prepaid insurance for the month of December debited to P&L a/c)

Salary payable a/c Dr. 18500

To Cash/ Bank a/c 18500

( Salary paid to employees for the month of December)

Profit &Loss a/c Dr. 16700 (18500+16700-18500)

To Salary payable a/c 16700

( Salary accrued till December debited to p&l account)

Profit &Loss a/c dr. 2200 (3200+3700-4700)

To Supplies a/c 2200

( Balancing figure from Supplies account debited to p&l )

Def Rent revenue a/c dr. 10800 (5400+8100-2700)

To Profit &Loss a/c 10800

( deferred rent revenue accrued till date has been credited to profit and loss account )