12 13 15 16 17 The ledger of Casper Consulting at January 31, 20X5 includes the following selected accounts: Debit Credit Prepaid insurance Supplies Building $ 3,600 1,800 100,000 60,000 Land Notes payable Unearned service revenue $90,000 8,000 Casper's accountant is inexperienced, and he would like your help in preparing the company's January 31, 20X5 financial statements. He has provided you with the following information: 1. A one-year insurance policy costing $3,600 was purchased on January 1, 20X5. At that time the full amount was debited to prepaid insurance. 2. A physical inventory count on January 31, 20X5 revealed $800 in supplies were still remaining. 3. Land and building were purchased on January 1, 20X5 at a cost of $160,000. The building has an expected useful life of 20 years. The purchase was financed by paying $70,000 in cash and the balance on a 2-year, 8% note payable. Interest for the month of January was $600 and was paid on February 1, 20X5. 4. Unearned service revenue related to a client retainer paid on January 15, 20X5. On January 31, 20X5, half of this amount has been earned. 5. Fees earned but unbilled for the month of January amounted to $5,000 6. A bill from Bell Telephone was received on January 29th and was unrecorded on January 31, 20X5. $750 of the bill related to January telephone charges. Payment of the telephone bill was made on February 22, 20X5. The payment in the amount of $875 paid for last months telephone bill and internet charges for February 20X5. Required: Part A: (15 Marks) Prepare the adjusting journal entries required at the month end January 31, 20X5. Part B: (3 Marks) Record the subsequent cash transactions in February 20x5.
12 13 15 16 17 The ledger of Casper Consulting at January 31, 20X5 includes the following selected accounts: Debit Credit Prepaid insurance Supplies Building $ 3,600 1,800 100,000 60,000 Land Notes payable Unearned service revenue $90,000 8,000 Casper's accountant is inexperienced, and he would like your help in preparing the company's January 31, 20X5 financial statements. He has provided you with the following information: 1. A one-year insurance policy costing $3,600 was purchased on January 1, 20X5. At that time the full amount was debited to prepaid insurance. 2. A physical inventory count on January 31, 20X5 revealed $800 in supplies were still remaining. 3. Land and building were purchased on January 1, 20X5 at a cost of $160,000. The building has an expected useful life of 20 years. The purchase was financed by paying $70,000 in cash and the balance on a 2-year, 8% note payable. Interest for the month of January was $600 and was paid on February 1, 20X5. 4. Unearned service revenue related to a client retainer paid on January 15, 20X5. On January 31, 20X5, half of this amount has been earned. 5. Fees earned but unbilled for the month of January amounted to $5,000 6. A bill from Bell Telephone was received on January 29th and was unrecorded on January 31, 20X5. $750 of the bill related to January telephone charges. Payment of the telephone bill was made on February 22, 20X5. The payment in the amount of $875 paid for last months telephone bill and internet charges for February 20X5. Required: Part A: (15 Marks) Prepare the adjusting journal entries required at the month end January 31, 20X5. Part B: (3 Marks) Record the subsequent cash transactions in February 20x5.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:The ledger of Casper Consulting at January 31, 20X5 includes the following selected
accounts:
Debit
$ 3,600
1,800
100,000
60,000
Credit
Prepaid insurance
Supplies
Building
Land
Notes payable
Unearned service revenue
$90,000
8,000
Casper's accountant is inexperienced, and he would like your help in preparing the
company's January 31, 20X5 financial statements. He has provided you with the following
information:
1. A one-year insurance policy costing $3,600 was purchased on January 1, 20X5. At
that time the full amount was debited to prepaid insurance.
2. A physical inventory count on January 31, 20X5 revealed $800 in supplies were still
remaining.
3. Land and building were purchased on January 1, 20X5 at a cost of $160,000. The
building has an expected useful life of 20 years. The purchase was financed by paying
$70,000 in cash and the balance on a 2-year, 8% note payable. Interest for the month
of January was $600 and was paid on February 1, 20X5.
4. Unearned service revenue related to a client retainer paid on January 15, 20X5. On
January 31, 20X5, half of this amount has been earned.
5. Fees earned but unbilled for the month of January amounted to $5,000
6. A bill from Bell Telephone was received on January 29th and was unrecorded on
January 31, 20X5. $750 of the bill related to January telephone charges. Payment of
the telephone bill was made on February 22, 20X5. The payment in the amount of
$875 paid for last months telephone bill and internet charges for February 20X5.
Required:
Part A: (15 Marks) Prepare the adjusting journal entries required at the month end
January 31, 20X5.
Part B: (3 Marks) Record the subsequent cash transactions in February 20x5.
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