Describe 2 accrual transactions and 2 deferral transactions that your peers will need to journalize. For the accrual transactions, please use credit or debit sales and credit purchase. For the deferral transactions, please use prepaid insurance and prepaid telephone charges. This is for an Electrotechnology Sales and Repairs business. Please include the dates that the transactions occurred. Please see the two pictures below, as I have included some examples of what the end product should look like. Please include an explanation as to what was done. Deferrals1. On October 1 TruGreen prepays insurance for the year for $10002. On October 2 TruGreen receives payment from a customer for a year'sworth of lawn care of $1200 for the year aheadAccruals1.On October 3 TruGreen performs service for business building for $100with a promise to pay from the business2. On October 3 TruGreen uses $20 of gas to perform service for businessbuilding Deferral1. Did $1,200 worth of work towards unearned service revenue of 5,000,2. Paid $4,200 for one years' worth of insurance.Accrual1. On October 12th, the company owes an employee $900 in salary that is tobe paid by October 13th.2. Revenue for services performed, but not recorded total $3,600.

Answered: Describe 2 accrual transactions and 2…

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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Describe 2 accrual transactions and 2 deferral transactions that your peers will need to journalize. For the accrual transactions, please use credit or debit sales and credit purchase. For the deferral transactions, please use prepaid insurance and prepaid telephone charges. This is for an Electrotechnology Sales and Repairs business. Please include the dates that the transactions occurred. Please see the two pictures below, as I have included some examples of what the end product should look like. Please include an explanation as to what was done.

Deferrals
1. On October 1 TruGreen prepays insurance for the year for $1000
2. On October 2 TruGreen receives payment from a customer for a year's
worth of lawn care of $1200 for the year ahead
Accruals
1.On October 3 TruGreen performs service for business building for $100
with a promise to pay from the business
2. On October 3 TruGreen uses $20 of gas to perform service for business
building

Deferral
1. Did $1,200 worth of work towards unearned service revenue of 5,000,
2. Paid $4,200 for one years' worth of insurance.
Accrual
1. On October 12th, the company owes an employee $900 in salary that is to
be paid by October 13th.
2. Revenue for services performed, but not recorded total $3,600.

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Journal entries are those entries which are recorded at the time when ever a transaction takes place even for the company has made an advance or the expense has been incurred but has not been paid yet by the company.

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