Question

Please help with correct answer and explaination if possible, thx!(:

3. For each of the following, journalize the necessary adjusting entry. A. Unpaid wages accrued were $4,000 B. The balance in the prepaid insurance account before adjustment at the end of the year is $12,000. The amount of insurance expired during the year is $8,500. C. The estimated depreciation on buildings for the year is $32,000. I

Answer 1

Account name	Dr	Cr
A. Wages expense	$4,000
Wages payable		$4,000
(Accrued wages recorded and corresponding liability created)
B. Insurance expense	$8500
Prepaid insurance		$8500
(Expired insurance recognised as expense)
C. Depreciation	$32,000
Accumulated depreciation		$32,000
(Depreciation recorded for building)

Note :

1. Wages payable will appear as liability in the balance sheet.

2. Expired insurance is recognised as expense and remaining prepaid insurance will appear as asset in the balance sheet.

Accumulated depreciation will reduce the value of fixed asset ie Building.