Question

culator justing entries Instructions Journal Chart of Accounts HI Final Question Instructions On December 31, the following data were accumulated for preparing the adjusting entries for Bellingham Realty • The supplies account balance on December 31 is $5,210. The supplies on hand on December 31 are $1,135. The uneared rent account balance on December 31 is $5,600 representing the receipt of an advance payment on December 1 of four months rent from tenants. • Wages accrued but not paid at December 31 are $2,125 • Fees earned but unbilled at December 31 are $18,625 Depreciation of office equipment is $4,805, Required: 1. Journalize the adjusting entries required at December 31. Refer to the Chart of Accounts for exact wording of account titles. 2. What is the difference between adjusting entries and correcting entries?

Answer 1

Date	Adjusting entries	Post ref.	Debit	Credit	Asset	Liabilities	Equity
Dec 31	Supplies Expense		4075				↓	=5210-1135
	Supplies			4075	↓
Dec 31	Unearned Rent revenue		1400			↓		=5600*1/4
	Rent revenue			1400			↑
Dec 31	Wages Expense		2125				↓
	Wages payable			2125		↑
Dec 31	Accounts Receivable		18625		↑
	Fees earned			18625			↑
Dec 31	Depreciation expense		4805				↓
	Accumulate depreciation-Office Equipment			4805	↓
2
Adjusting entries are a planned part of the accounting process to update the accounts. Correcting entries are not planned,
but arise only when necessary to correct errors.