Hentzel Landscaping commenced its business on January 1, 20X1. During its first year of operations, Hentzel purchased supplies in the amount of $12,000 (debited to Supplies inventory), and of this amount, $3,000 were unused as of December 31, 20X1. On March 1, 20X1, Hentzel received $18,000 for landscaping services to be rendered for 18 months (beginning July 1, 20X1). This amount was credited to a liability called Deferred landscaping revenue. The company’s gasoline bill for $2,500 for the month of December 20X1 was not received until January 15, 20X2. No entry was made. The company borrowed $50,000 from HomeTown Financing on April 1, 20X1, at a 5% interest rate per annum. It credited a liability for notes payable. The principal, along with all the interest, is due on April 1, 20X2. On January 1, 20X1, the company purchased 10 lawnmowers at $3,000 each. It debited fixed assets. The lawnmowers are expected to last for three years with no salvage value. On December 31, 20X1, Hentzel did not record any adjusting entries with respect to these transactions. Prepare all adjusting entries necessary to prepare financial statements for 20X1 in accordance with U.S. GAAP. Ignore income taxes. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Journal entry worksheet Note: Enter debits before credits. Transaction General Journal Debit Credit 1 0

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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Hentzel Landscaping commenced its business on January 1, 20X1.

During its first year of operations, Hentzel purchased supplies in the amount of $12,000 (debited to Supplies inventory), and of this amount, $3,000 were unused as of December 31, 20X1.
On March 1, 20X1, Hentzel received $18,000 for landscaping services to be rendered for 18 months (beginning July 1, 20X1). This amount was credited to a liability called Deferred landscaping revenue.
The company’s gasoline bill for $2,500 for the month of December 20X1 was not received until January 15, 20X2. No entry was made.
The company borrowed $50,000 from HomeTown Financing on April 1, 20X1, at a 5% interest rate per annum. It credited a liability for notes payable. The principal, along with all the interest, is due on April 1, 20X2.
On January 1, 20X1, the company purchased 10 lawnmowers at $3,000 each. It debited fixed assets. The lawnmowers are expected to last for three years with no salvage value.

On December 31, 20X1, Hentzel did not record any adjusting entries with respect to these transactions.

Prepare all adjusting entries necessary to prepare financial statements for 20X1 in accordance with U.S. GAAP. Ignore income taxes. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Journal entry worksheet

Note: Enter debits before credits.

Transaction	General Journal	Debit	Credit
1			0

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