An analysis of the accounts shows the following. 1. The equipment is depreciated over 5 years, and it has no salvage value. 2. $1,000 of the unearned rent was earned during the quarter. 3. Annual interest of $2,400 will be paid on the notes payable at 12/31. Accrue the proper amount at 3/31. 4. A count of Supplies showed that $2,000 was still on hand at 3/31. 5. The balance in prepaid insurance is the amount paid for a 2 year policy on January 1. Prepare the adjusting entries at March 31, assuming that adjusting entries are made quarterly. Additional accounts are Depreciation Expense, Insurance Expense, Interest Payable, and Supplies Expenses.

An analysis of the accounts shows the following. 1. The equipment is depreciated over 5 years, and it has no salvage value. 2. $1,000 of the unearned rent was earned during the quarter. 3. Annual interest of $2,400 will be paid on the notes payable at 12/31. Accrue the proper amount at 3/31. 4. A count of Supplies showed that $2,000 was still on hand at 3/31. 5. The balance in prepaid insurance is the amount paid for a 2 year policy on January 1. Prepare the adjusting entries at March 31, assuming that adjusting entries are made quarterly. Additional accounts are Depreciation Expense, Insurance Expense, Interest Payable, and Supplies Expenses.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

The ledger of Hillsboro Rental Agency on March 31 of the current year includes the following selected accounts before
adjusting entries have been prepared. Assume no adjusting entries were made in Januaray or February either.
Prepaid Insurance
Supplies
Equipment
Accumulated Depreciation-
Equipment
Notes Payable
Unearned Rent Revenue
Rent Revenue
Interest Expense
Salaries and Wages Expense
Debit
$ 3,600
3,053
26,200
-0-
15,330
Credit
$ 8,921
20,600
7,500
54,170

An analysis of the accounts shows the following.
1. The equipment is depreciated over 5 years, and it has no salvage value.
2. $1,000 of the unearned rent was earned during the quarter.
3. Annual interest of $2,400 will be paid on the notes payable at 12/31. Accrue the
proper amount at 3/31.
4. A count of Supplies showed that $2,000 was still on hand at 3/31.
5. The balance in prepaid insurance is the amount paid for a 2 year policy on January
1.
Prepare the adjusting entries at March 31, assuming that adjusting entries are made quarterly. Additional accounts are
Depreciation Expense, Insurance Expense, Interest Payable, and Supplies Expenses.

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