Question

Desoto Company must make three adjusting entries on December 31, 2019.

Supplies used, $5,500 (supplies totaling $9,000 were purchased on December 1, 2019, and debited to the Supplies account).

Expired insurance, $4,100; on December 1, 2019, the firm paid $24,600 for six months’ insurance coverage in advance and debited Prepaid Insurance for this amount.

Depreciation expense for equipment, $2,900.

Required:
Prepare the journal entries for these adjustments and post the entries to the general ledger accounts

Answer 1

Journal entries
Account titles & Explanations					Debit	Credit
Supplies expense					5,500
supplies.						5,500
insurance expense					4,100
prepaid insurance						4,100
Depreciation expense					2,900
Accumulated depreciation						2,900
T-Accounts
Supplies
1/1/2019	9,000	12/31/2019	5,500
end bal	3500
Supplies expense
12/31/2019	5,500
end bal	5,500
prepaid insurance
1/1/2019	24,600	12/31/2019	4,100
end bal	20500
Insurance expense
12/31/2019	4,100
end bal	4,100
Depreciation expense
12/31/2019	2,900
end bal	2,900
Accumulated Depreciation
		43,830	2,900
		end bal	2,900