Question

Cullumber Company has the following information available for accruals for the year ended December 31, 2022. The company adjusts its accounts annually. 1. 2. 3. The December utility bill for $315 was unrecorded on December 31. Cullumber paid the bill on January 11. Cullumber is open 7 days a week and employees are paid a total of $2,590 every Monday for a 7-day (Monday-Sunday) workweek. December 31 is a Thursday, so employees will have worked 4 days (Monday, December 28-Thursday, December 31) that they have not been paid for by year-end. Employees will be paid next on January 4. Cullumber signed a $33,000, 5% bank loan on November 1, 2021, due in 2 years. Interest is payable on the first day of each following month. Cullumber receives a fee from Pizza Shop next door for all pizzas sold to customers using Cullumber's facility. The amount owed for December is $220, which Pizza Shop will pay on January 4. (Hint: Use the Service Revenue account.) Cullumber rented some of its unused warehouse space to a client for $4,440 a month, payable the first day of the following month. It received the rent for the month of December on January 2. 4. 5.

Answer 1

Answer:

No.	Date	Account Titles and Explanation	Debit	Credit
1	Dec 31,2022	Utilities expense	$315
		Utilities payable		$315
		[To record accrued utilities expense]
2	Dec 31,2022	Salaries and Wages Expense [$2,590 x 4/7]	$1,480
		Salaries and Wages payable
		[To record accrued salaries and wages expense]
3	Dec 31,2022	Interet expense [$33,000 x 5% x (1/12)]	$137.50
		Interest payable		$138
		[To record accrued interset expense]
4	Dec 31,2022	Accounts Receivable	$220
		Service revenue		$220
		[To record accrued service revenue]
5	Dec 31,2022	Rent receivable	$4,440
		Rent revenue		$4,440
		[To record accrued rent revenue]
No.	Date	Account Titles and Explanation	Debit	Credit
1	Jan 11,2023	Utilities payable	$315
		Cash		$315
		[To record payment of utilities]
2	Jan 4, 2023	Salaries and wages payable	$1,480
		Salaries and wages expense [$2,590 x 3/7]	$1,110
		Cash		$2,590
		[To record payment of salaries]
3	Jan 1,2023	Interest payable	$137.50
		Cash		$137.50
		[To record payment of interest]
4	Jan 4,2023	Cash	$220
		Accounts receivable		220
		[To record collections from customers]
5	Jan 2, 2023	Cash	$4,440
		Rent receivable		$4,440
		[To record rent received]