Question

2. The Information below pertains to the Javelina Market's 2020 Information Javelina Market accounts for transactions on the cash basis during the year. At year, the accountant has to adjust the books to the accrual basis. Trial Balance 31-Jul-20 Debit Credit Cash 20,250 Account Receivable, 7/31/19 5,300 Inventory, 7/31/19 20,000 Equipment 35,000 Accumulated Depr 7/31/19 9,000 Account Payable, 7/31/19 4,800 Payroll Tax Withheld 850 Javelina, Withdrawals 24,000 Javelina, Capital 7/31/19 35,400 Sales 187,800 Cost of Goods Sold 82,700 Salaries 29,500 Payroll Taxes 2,900 Rent 8,400 Miscellaneous Expense 3,900 Insurance 2,400 Utilities 3,500 Totals 237,850 237,850 Additional information: 2 . 1. 2 3. 4. 5. Amounts due from customers total$9,000 at 7/31/20. A review of the receivables shows that an allowance of doubtful accounts of $900 should be provided. Accounts Payable at 7/31/20 should be $6,000. (Make adjustment against Inventory). Based on a physical count, inventory is $21,500. (Don't forget about previous entry) On July 1, Javelina paid one year's rent in advance in the amount of $4,200 and recorded the entire amount as Rent Expense. On July 1, Javelina paid $1,200 on insurance for the upcoming fiscal year. (Aug 1-July 31, 2021) Depreciation for the year ended 7/31/2020 was $4,750. Accrued expenses at July 31, 2020 are: Salaries of $510 and Utilities of $600. 6. 7. 8. Prepare the required adjusting entries. es)

Answer 1

S.No.	Account Titles	Debit $	Credit $
1	Accounts Receivable	3,700
	Sales		3,700
	(9,000 - 5,300 )
2	Bad Debt Expense	900
	Allowance for Doubtful account		900
3	Inventory	1,200
	Accounts payable		1,200
	(6,000 - 4,800 )
4	Inventory	300
	Cost of goods sold		300
	(21,500 - 20,000 - 1,200 )
5	Prepaid Rent	3,850
	Rent Expense		3,850
	( 4,200 x 11/12 )
6	Prepaid Insurance	1,200
	Insurance Expense		1,200
7	Depreciation Expense	4,750
	Accumulated Depreciation		4,750
8	Salaries Expense	510
	Utilities Expense	600
	Salaries Payable		510
	Utility Payable		600