Broncos, Inc. has prepared a year-end 2020 trial balance. Certain accounts in the trial balance do not reflect all activities that have occurred. Required: Prepare adjusting journal entries, as needed, for the following items. If no adjusting entry is needed, write NONE. Prepare adjusting entries ONLY. You will lose a point or two if unnecessary entries are recorded. 1) On November 1, 2020, the company paid its landlord $9,000 representing rent for the months of November through January. Rent expense was debited when paid in cash. 2) Broncos initially records the payments of all insurance premiums as expenses. The trial balance shows a balance of $420 in Insurance expense. A review of insurance policies reveals that $220 of insurance is unexpired. 3) On October 1, 2020, Broncos borrowed $75,000 from a local Bank and signed a note. The note requires interest to be paid semi-annually on March 31 and September 30 at 12%. 4) On April 1, 2020, Broncos paid $3,600 for a two-year fire insurance policy and debited prepaid insurance. 5) Broncos debited supplies (as an asset) when purchased at $3,000 in 2020. Supplies on hand at year-end were only $500. 6) Broncos' football equipment was purchased at a cost of $35,000 on October 1, 2020. It has a five year useful life and no salvage value. The straight-line depreciation is used. 7) On March 1, 2020, Broncos leased a warehouse to another company for $48,000 for a two-year period. The company credited a revenue account on March 1, 2020 when the total amount of $48,000 was received in cash.
Broncos, Inc. has prepared a year-end 2020
Required:
Prepare adjusting
1) On November 1, 2020, the company paid its landlord $9,000 representing rent for the months of November through January. Rent expense was debited when paid in cash.
2) Broncos initially records the payments of all insurance premiums as expenses. The trial balance shows a balance of $420 in Insurance expense. A review of insurance policies reveals that $220 of insurance is unexpired.
3) On October 1, 2020, Broncos borrowed $75,000 from a local Bank and signed a note. The note requires interest to be paid semi-annually on March 31 and September 30 at 12%.
4) On April 1, 2020, Broncos paid $3,600 for a two-year fire insurance policy and debited prepaid insurance.
5) Broncos debited supplies (as an asset) when purchased at $3,000 in 2020. Supplies on hand at year-end were only $500.
6) Broncos' football equipment was purchased at a cost of $35,000 on October 1, 2020. It has a five year useful life and no salvage value. The straight-line
7) On March 1, 2020, Broncos leased a warehouse to another company for $48,000 for a two-year period. The company credited a revenue account on March 1, 2020 when the total amount of $48,000 was received in cash.
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