Question and answer
1 Supplies on hand at June 30 total $980. 2. A utility bill for $180 has not been recorded and will not be paid until next month. 3. The insurance policy is for a year. 4. $3,900 of unearned
service revenue has been earned at the end of the month. 5. Salaries of $1,250 are accrued at June 30. 6. The office equipment has a 5-year life with no salvage value and is being depreciated at $250 per month for 60 months. 7. Invoices representing $3,500 of services performed during the month have not been recorded as of June 30. Prepare the adjusting entries for the month of June.
Before we prepare the trial balance, we need to "update the books" and make sure the general ledger balances reflect ALL activity during the period. [ Not everything up to this point has been entered into the general journal, so we need to prepare journal entries, i.e., adjusting entries, to determine the correct ending balances. Our adjusting entries will be based on the information under
"Other data." 1. The balance in Supplies should be $980. According to the beginning of the year balances, however, it is $2000. We need to "adjust" the balance of Supplies so that it reflects the actual amount of supplies on hand and to recognize, as an expense, the amount of supplies used up. Our adjusting entry looks like this: Supplies expense . . . . . 1020 . . Supplies . . . . . . . . . . . . . . 1020 2. There is a liability for utilities outstanding at the end of the month. We need to report this liability as well as ensure that this expense is recorded - after all, the utilities bill is for THIS month. Utilities expense . . . . . . . 180 . . . Utilities payable . . . . . . . . 180 3. The insurance policy, purchased for $2640, is for one year. One month has passed, so one month of the insurance policy has been "used up." What we're really doing is matching expenses with revenues; the insurance policy needs to be expensed throughout its life. Insurance expense . . . . . 220 . . . Prepaid insurance . . . . . . 220 . . . . [ 2640 / 12 ] 4. At the beginning of the month, unearned service revenue of $5200 is reported. $3900 was earned during the month, so we need to 1) recognize the revenue earned and 2) decrease our liability, as we no longer owe our customers $5200 of services. Unearned service revenue . . . 3900 . . . Service revenue . . . . . . . . . . . . 3900 5. Like #2, salaries is an accrued expense, an expense of the period that won't be paid until next month. This means that, as of June 30, there is a liability to pay the employees the salary they earned. Salaries and wages expense . . . 1250 . . . Salaries and wages payable . . . . . 1250 6. ]
Expert answered|jeifunk|Points 8949|
Question
Asked 3/11/2013 8:18:54 AM
0 Answers/Comments
Get an answer
New answers
Rating

There are no new answers.

Comments

There are no comments.

Add an answer or comment
Log in or sign up first.
18,799,929 questions answered
Popular Conversations
Race is a myth in the sense that one race is superior to another and ...
Weegy: True - Race is a myth in the sense that one race is superior to another and of there being pure races. User: ...
12/20/2014 6:09:11 PM| 2 Answers
Multiply. (-8.7)(-1.1) User: divide -5/-20
Weegy: The answer is 100
12/21/2014 10:42:03 AM| 2 Answers
definition of absurdity
12/20/2014 12:13:09 AM| 1 Answers
If your supervisor criticizes the way you handled a certain ...
Weegy: A. clarify how your way of handling it was best. User: You can perform your job well only if you A. ...
12/20/2014 12:00:56 AM| 1 Answers
Personal pronouns take different forms depending on whether they’re ...
Weegy: When we want to show that something belongs to somebody or something, we usually add 's to a singular noun and ...
12/20/2014 12:24:16 AM| 1 Answers
Subjects in sentences refer either to nouns or to A. adverbs. ...
Weegy: An adjective can come before or after a noun or pronoun in a sentence.
12/20/2014 12:23:55 AM| 1 Answers
Weegy Stuff
S
L
P
Points 1135 [Total 4979]| Ratings 0| Comments 1135| Invitations 0|Offline
S
L
Points 741 [Total 1432]| Ratings 1| Comments 731| Invitations 0|Offline
S
1
L
1
L
P
P
L
P
Points 692 [Total 14877]| Ratings 1| Comments 682| Invitations 0|Offline
S
Points 681 [Total 681]| Ratings 1| Comments 671| Invitations 0|Offline
S
P
C
L
P
L
1
Points 118 [Total 6437]| Ratings 1| Comments 108| Invitations 0|Offline
S
L
Points 81 [Total 1541]| Ratings 1| Comments 71| Invitations 0|Online
S
1
L
L
Points 33 [Total 6700]| Ratings 0| Comments 33| Invitations 0|Offline
S
Points 30 [Total 30]| Ratings 0| Comments 0| Invitations 3|Offline
S
Points 23 [Total 29]| Ratings 0| Comments 23| Invitations 0|Offline
S
Points 22 [Total 22]| Ratings 0| Comments 2| Invitations 2|Offline
Home | Contact | Blog | About | Terms | Privacy | Social | ©2014 Purple Inc.