Problem

(L.OBJ. 2, 3) Journalizing adjusting and closing entries [20-30 min] The accountant for...

(L.OBJ. 2, 3) Journalizing adjusting and closing entries [20-30 min]

The accountant for Daniel Ferguson, M.D., encountered the following situations while adjusting and closing the books at December 31. Consider each situation independently.

Requirements

1. The accountant failed to make the following adjusting entries at December 31: Compute the overall net income effect of these omissions.

a. Accrued salary expense, $1,800

b. Supplies expense, $600

c. Accrued interest expense on a note payable, $800

d. Depreciation of equipment, $900

e. Earned service revenue that had been collected in advance, $2,400

2. Journalize each omitted adjusting entry identified.

3. What is the overall effect of the adjustments to net income?

4. Assume Withdrawals were $6,000 for the year. Prepare the entry to close the Withdrawals account.

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