### Reversing Entries: Adjusting Entries AnalysisCertain adjusting entries made at the end of an accounting period are reversed at the beginning of the following period.**Required:**Analyze the following four [adjusting entries](https://www.yourwebsite.com/adjusting-entries) made on December 31, and determine whether a [reversing entry](https://www.yourwebsite.com/reversing-entry) is needed.#### Adjusting Entries Table| Date | Description | Debit | Credit | Reversing entry necessary | Reversing entry not necessary ||------------------|---------------------|---------|---------|---------------------------|-------------------------------|| Dec. 31 | Interest Receivable | 1,200 | | ![Selected](https://www.yourwebsite.com/circle) | || | Interest Revenue | | 1,200 | | || Dec. 31 | Rent Expense | 1,000 | | | ![Selected](https://www.yourwebsite.com/circle) | | | Prepaid Rent | | 1,000 | | || Dec. 31 | Interest Expense | 800 | | ![Selected](https://www.yourwebsite.com/circle) | || | Interest Payable | | 800 | | || Dec. 31 | Supplies Expense | 520 | | | ![Selected](https://www.yourwebsite.com/circle) | | | Supplies | | 520 | | |**Legend:**- ![Selected](https://www.yourwebsite.com/circle): Indicates the selection made for whether a reversing entry is necessary.### ExplanationClick [here](https://www.yourwebsite.com/explanation) for a detailed explanation of why reversing entries might be necessary for interest receivables and expenses but not for prepaid rent and supply expenses.### Additional Resources- [Adjusting Entries](https://www.yourwebsite.com/adjusting-entries)- [Reversing Entries](https://www.yourwebsite.com/reversing-entry)*Note: The linked images and URLs are placeholders and should be replaced with actual content when integrating into your educational website.*

First let us understand what are adjusting entries. Adjusting entries are entries made at the end of…

Certain adjusting entries made at the end of an accounting period are reversed at the beginning of the following period. Required: Analyze the following four adjusting entries made on December 31, and determine whether a reversing entry is needed. Date Description Debit Credit Reversing entry Reversing entry necessary not necessary Dec. 31 Interest Receivable 1,200 O 1,200 31 Rent Expense 1,000 1,000 31 Interest Expense 800 800 31 Supplies Expense 520 Supplies Interest Revenue Prepaid Rent Interest Payable 520 O x 3 ?

Certain adjusting entries made at the end of an accounting period are reversed at the beginning of the following period. Required: Analyze the following four adjusting entries made on December 31, and determine whether a reversing entry is needed. Date Description Debit Credit Reversing entry Reversing entry necessary not necessary Dec. 31 Interest Receivable 1,200 O 1,200 31 Rent Expense 1,000 1,000 31 Interest Expense 800 800 31 Supplies Expense 520 Supplies Interest Revenue Prepaid Rent Interest Payable 520 O x 3 ?

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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Med Labs has the following December 31 year-end unadjusted balances: Allowance for Sales Discounts, $0; and Accounts Receivable, $6,400. Of the $6,400 of receivables, $1,700 are within a 3% discount period, meaning that it expects buyers to take $51 in future-period discounts arising from this period's sales. a. Prepare the December 31 year-end adjusting journal entry for future sales discounts. b. Assume the same facts above and that there is a $6 year-end unadjusted credit balance in Allowance for Sales Discounts. Prepare the December 31 year-end adjusting journal entry for future sales discounts.
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