Problem 12.1A (Algo) Recording adjustments for accrued and prepaid items and unearned income. LO 12-2, 12-3 a.-b. Merchandise Inventory, before adjustment, has a balance of $7,400. The newly counted inventory balance is $7.900. c. Unearned Seminar Fees has a balance of $5,900, representing prepayment by customers for five seminars to be conducted in June, July, and August 20X1. Two seminars had been conducted by June 30, 20X1. d. Prepaid Insurance has a balance of $11,400 for six months' insurance paid in advance on May 1, 20X1. e. Store equipment costing $13,450 was purchased on March 31, 20X1. It has a salvage value of $490 and a useful life of six years. f. Employees have earned $240 that has not been paid at June 30, 20X1. g. The employer owes the following taxes on wages not paid at June 30, 20X1: SUTA, $7.20; FUTA, $1.44; Medicare, $3.48; and social security, $14.88. h. Management estimates uncollectible accounts expense at 1 percent of sales. This year's sales were $1,900,000. i. Prepaid Rent has a balance of $6,450 for six months' rent paid in advance on March 1, 20X1. J. The Supplies account in the general ledger has a balance of $390. A count of supplies on hand at June 30, 20X1, indicated $145- of supplies remain. k. The company borrowed $8,800 from Second Bancorp on June 1, 20X1, and issued a four-month note. The note bears interest at 6 percent. Required: Based on the information above, record the adjusting journal entries that must be made for Sufen Consulting on June 30, 20X1. The company has a June 30 fiscal year-end. Analyze: After all adjusting entries have been journalized and posted, what is the balance of the Prepaid Rent account?
Problem 12.1A (Algo) Recording adjustments for accrued and prepaid items and unearned income. LO 12-2, 12-3 a.-b. Merchandise Inventory, before adjustment, has a balance of $7,400. The newly counted inventory balance is $7.900. c. Unearned Seminar Fees has a balance of $5,900, representing prepayment by customers for five seminars to be conducted in June, July, and August 20X1. Two seminars had been conducted by June 30, 20X1. d. Prepaid Insurance has a balance of $11,400 for six months' insurance paid in advance on May 1, 20X1. e. Store equipment costing $13,450 was purchased on March 31, 20X1. It has a salvage value of $490 and a useful life of six years. f. Employees have earned $240 that has not been paid at June 30, 20X1. g. The employer owes the following taxes on wages not paid at June 30, 20X1: SUTA, $7.20; FUTA, $1.44; Medicare, $3.48; and social security, $14.88. h. Management estimates uncollectible accounts expense at 1 percent of sales. This year's sales were $1,900,000. i. Prepaid Rent has a balance of $6,450 for six months' rent paid in advance on March 1, 20X1. J. The Supplies account in the general ledger has a balance of $390. A count of supplies on hand at June 30, 20X1, indicated $145- of supplies remain. k. The company borrowed $8,800 from Second Bancorp on June 1, 20X1, and issued a four-month note. The note bears interest at 6 percent. Required: Based on the information above, record the adjusting journal entries that must be made for Sufen Consulting on June 30, 20X1. The company has a June 30 fiscal year-end. Analyze: After all adjusting entries have been journalized and posted, what is the balance of the Prepaid Rent account?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
100%
Please don't provide answer in image format. Thank You.
Transcribed Image Text:Problem 12.1A (Algo) Recording adjustments for accrued and prepaid items and unearned income. LO
12-2, 12-3
a.-b. Merchandise Inventory, before adjustment, has a balance of $7,400. The newly counted inventory balance is $7.900.
c. Unearned Seminar Fees has a balance of $5,900, representing prepayment by customers for five seminars to be conducted in
June, July, and August 20X1. Two seminars had been conducted by June 30, 20X1.
d. Prepaid Insurance has a balance of $11,400 for six months' insurance paid in advance on May 1, 20X1.
e. Store equipment costing $13,450 was purchased on March 31, 20X1. It has a salvage value of $490 and a useful life of six years.
f. Employees have earned $240 that has not been paid at June 30, 20X1.
g. The employer owes the following taxes on wages not paid at June 30, 20X1: SUTA, $7.20; FUTA, $1.44; Medicare, $3.48; and
social security, $14.88.
h. Management estimates uncollectible accounts expense at 1 percent of sales. This year's sales were $1,900,000.
i. Prepaid Rent has a balance of $6,450 for six months' rent paid in advance on March 1, 20X1.
J. The Supplies account in the general ledger has a balance of $390. A count of supplies on hand at June 30, 20X1, indicated $145
of supplies remain.
k. The company borrowed $8,800 from Second Bancorp on June 1, 20X1, and issued a four-month note. The note bears interest at
6 percent.
Required:
Based on the information above, record the adjusting journal entries that must be made for Sufen Consulting on June 30, 20X1. The
company has a June 30 fiscal year-end.
Analyze:
After-all adjusting entries have been journalized and posted, what is the balance of the Prepaid Rent account?
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education