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FINANCIAL ACCOUNTING
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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meldeng Problem #4 Preparing the Adjusting Entries at Year-End You to prepare Edgar Detoya Research and Development adjusting entries: The Supplies account showed a beginning balance of P21,740. Purchases during the year were P45,260. The ending inventory revealed supplies on hand of P 13,970. а. D. The Prepaid Insurance account showed the following on November 30: Beginning balance July 1 P35,800 42,000 72,720 October 1 The beginning balance represented the unexpired portion of a one-year policy purchased in September 2017. The July 1 entry represented a new one-year policy, and the Oct. 1 entry is additional coverage in the form of a three-year policy. The following table contains the cost and annual depreciation for buildings and equipment, all of which the entity purchased before the current year: С. paf Account Cost Annual Depreciation Buildings P145,000 P2,860,000 o theysd 3,740,000 Equipment S0 354,000 97 d. On September 1, the entity completed negotiations with a client and accepted an advance of P168,000 for services to be performed next year. The P168,000 was credited to Unearned Service Revenues. The entity calculated that as of November 30, it had earned P40,000 on an P110,000 contract that would be completed and billed in January. е. f. Among the liabilities of the entity is a note payable in the amount of P3,000,000. On November 30, the accrued interest on this note amounted to P150,000. g. Assume that on, December 3, a Saturday, the entity, which is on a six-day workweek, will pay its regular salaried employees P123,000. h. On November 29, the entity completed negotiations and signed a contract to provide services to a new client at an annual rate of P175,000.
Transcribed Image Text:meldeng Problem #4 Preparing the Adjusting Entries at Year-End You to prepare Edgar Detoya Research and Development adjusting entries: The Supplies account showed a beginning balance of P21,740. Purchases during the year were P45,260. The ending inventory revealed supplies on hand of P 13,970. а. D. The Prepaid Insurance account showed the following on November 30: Beginning balance July 1 P35,800 42,000 72,720 October 1 The beginning balance represented the unexpired portion of a one-year policy purchased in September 2017. The July 1 entry represented a new one-year policy, and the Oct. 1 entry is additional coverage in the form of a three-year policy. The following table contains the cost and annual depreciation for buildings and equipment, all of which the entity purchased before the current year: С. paf Account Cost Annual Depreciation Buildings P145,000 P2,860,000 o theysd 3,740,000 Equipment S0 354,000 97 d. On September 1, the entity completed negotiations with a client and accepted an advance of P168,000 for services to be performed next year. The P168,000 was credited to Unearned Service Revenues. The entity calculated that as of November 30, it had earned P40,000 on an P110,000 contract that would be completed and billed in January. е. f. Among the liabilities of the entity is a note payable in the amount of P3,000,000. On November 30, the accrued interest on this note amounted to P150,000. g. Assume that on, December 3, a Saturday, the entity, which is on a six-day workweek, will pay its regular salaried employees P123,000. h. On November 29, the entity completed negotiations and signed a contract to provide services to a new client at an annual rate of P175,000.
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