Prepare the journal entry for the reversal of the balance on the last day of adjustment and post it to the general ledger accounts from the information I to iv provided above   (Must have T account and reversal of balance)

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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Eng Hardwares has the following balance as at 30 November 2020:
Accounts RM’000
Wages(Debit) 110,000
Insurance (Debit) 2,000
Rental (Credit) 50,000
4
Additional information:
i. Eng Hardwares pays wages to its workers at the end of every month. However,
some internal problems arise and it did not pay wages amounting to RM10,000 to its
workers on time on the last day of December 2020.
ii. It paid RM10,000 for insurance covered from period December 2020 until March
2021 on 3rd December 2020.
iii. It rents out part of its warehouse to another business for RM2,000 per month and
receives the rent on the last day of each quarter on 31st March, 30th June, 30th
September, and 31st December. However, the tenant has some financial difficulties
and failed to pay the three-month rent from October 2020 to December 2020 on 31
December, 2020.
iv. On 1 December 2020 it received RM21,600 for a one year rental from a new tenant.
Required:-
Prepare the journal entry for the reversal of the balance on the last day of adjustment
and post it to the general ledger accounts from the information I to iv provided above

 

(Must have T account and reversal of balance)

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