Question

Exercise 3-s mcwork en March 31 of the oarrest yeor indludes the following selected accounts before adhjusting entries bave been prepared Prepaid Insurance Supplies 27,460 $7.905 19.990 Notes Payable Its by Study Unearned Rent Revenue Rent Reverue Interest Expense Sislaries and Wages Expense 62 420 An analysis of the accounts shows the following 1. The equipment depreciates $263 per month 2. One-third of the unearned rent was earmed as revenue during the quarter 3. Interest of $530 is accrued on the notes payable 4. Supplies on hand total $678 s. Insurance expires at the rate of $271 per month

Answer 1

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No	Account title and explanation		Dr	Cr
1	Depreciation		789
	Accumulated depreciation-equipment			789
	To record 3 months of depreciation, 263*3 = 789
2	unearned revenue		1150
	Rent revenue			1150
	To record earning one-third of the rent revenue, 3450/3 = 1150
3
	Interest expense		530
	Interest payable			530
	To record the accrual of interest on the notes payable
4
	Supplies expense		1926
	Supplies			1926
	To record the use of supplies, 2604-678 = 1926
5
	Insurance expense		813
	Prepaid insurance			813
	To record the expiration of insurance, 271*3 = 813