Question

The ledger of Pina Colada Corp. on March 31 of the current year includes the selected accounts, shown below, before quarterly adjusting entries have been prepared. Credit Debit $ 1,800 3,400 18,750 Prepaid Insurance Supplies Equipment Accumulated Depreciation Equipment Notes Payable Unearned Rent Revenue Rent Revenue Interest Expense Salaries and Wages Expense $ 8,600 21,000 9,900 61,000 0 11,000 An analysis of the accounts shows the following. 1. 2. 3. The equipment depreciates $300 per month. One-third of the unearned rent revenue was earned during the quarter. Interest totaling $525 is accrued on the notes payable for the quarter. Supplies on hand total $570. Insurance expires at the rate of $100 per month. 4. 5.

Answer 1

Date	Account titles & explanations					debit	credit
31-Mar	Depreciation expense					900
	Accumulated depreciation -Equipment						900
31-Mar	unearned rent revenue		(9900*1/3)			3300
	rent revenue						3,300
31-Mar	interest expense					525
	interest payable						525
31-Mar	Supplies expense					2830
	Supplies.	(3400-570)					2,830
31-Mar	insurance expense					300
	prepaid insurance						300