Reversing EntriesGimbel's Gifts and GadgetsEnd-of-Period SpreadsheetFor Year Ended December 31, 20-1 TRIAL BALANCEADJUSTMENTSADJUSTED TRIAL BALANCEACCOUNT TITLEDEBITCREDITDEBITCREDITDEBITCREDITCash16,000.00 16,000.00 Accounts Receivable11,200.00 11,200.00 Merchandise Inventory60,000.00 (b)68,000.00(a)60,000.0068,000.00 Estimated Returns Inventory2,560.00 (e)3,440.00(d)2,560.003,440.00 Supplies6,400.00 (f)3,760.002,640.00 Prepaid Insurance4,320.00 (g)1,280.003,040.00 Land104,000.00 104,000.00 Building200,000.00 200,000.00 Accum. Depr.—Building 80,000.00 (h)10,000.00 90,000.00Store Equipment80,000.00 80,000.00 Accum. Depr.—Store Equipment 32,000.00 (i)4,000.00 36,000.00Accounts Payable 7,680.00 7,680.00Customer Refunds Payable 2,800.00 (c)1,760.00 4,560.00Wages Payable (j)2,800.00 2,800.00Sales Tax Payable 4,720.00 4,720.00Unearned Subscriptions Revenue 7,120.00(k)3,520.00 3,600.00J.M. Gimble, Capital 227,448.00 227,448.00J.M. Gimble, Drawing20,800.00 20,800.00 Income Summary (a)60,000.00(b)68,000.0060,000.0068,000.00 (d)2,560.00(e)3,440.002,560.003,440.00Sales 420,112.00 420,112.00Sales Returns and Allowances11,600.00 (c)1,760.00 13,360.00 Rent Revenue (k)3,520.00 3,520.00Purchases100,000.00 100,000.00 Purchases Returns and Allowances 1,120.00 1,120.00Purchases Discounts 1,440.00 1,440.00Freight-In1,680.00 1,680.00 Wages Expense100,000.00 (j)2,800.00 102,800.00 Advertising Expense10,400.00 10,400.00 Supplies Expense (f)3,760.00 3,760.00 Phone Expense1,080.00 1,080.00 Utilities Expense6,400.00 6,400.00 Insurance Expense (g)1,280.00 1,280.00 Depr. Expense—Building (h)10,000.00 10,000.00 Depr. Expense—Store Equipment (f)4,000.00 4,000.00 Rent Expense48,000.00 48,000.00 784,440.00784,440.00 161,120.00 161,120.00874,440.00874,440.00 365,320.00497,632.00Net Income 132,312.00 From the spreadsheet, identify the adjusting entry(ies) that should be reversed and prepare the reversing entry(ies).Page: 1 DATEACCOUNT TITLEDOC.NO.POST.REF.DEBITCREDIT 120-2Jan. 1 fill in the blank 2fill in the blank 312 fill in the blank 5fill in the blank 623 3

Answered: rom the spreadsheet, identify the…

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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Reversing Entries

Gimbel's Gifts and Gadgets End-of-Period Spreadsheet For Year Ended December 31, 20-1
	TRIAL BALANCE	ADJUSTMENTS	ADJUSTED TRIAL BALANCE
ACCOUNT TITLE	DEBIT	CREDIT	DEBIT	CREDIT	DEBIT	CREDIT
Cash	16,000.00						16,000.00
Accounts Receivable	11,200.00						11,200.00
Merchandise Inventory	60,000.00		(b)	68,000.00	(a)	60,000.00	68,000.00
Estimated Returns Inventory	2,560.00		(e)	3,440.00	(d)	2,560.00	3,440.00
Supplies	6,400.00				(f)	3,760.00	2,640.00
Prepaid Insurance	4,320.00				(g)	1,280.00	3,040.00
Land	104,000.00						104,000.00
Building	200,000.00						200,000.00
Accum. Depr.—Building		80,000.00			(h)	10,000.00		90,000.00
Store Equipment	80,000.00						80,000.00
Accum. Depr.—Store Equipment		32,000.00			(i)	4,000.00		36,000.00
Accounts Payable		7,680.00						7,680.00
Customer Refunds Payable		2,800.00			(c)	1,760.00		4,560.00
Wages Payable					(j)	2,800.00		2,800.00
Sales Tax Payable		4,720.00						4,720.00
Unearned Subscriptions Revenue		7,120.00	(k)	3,520.00				3,600.00
J.M. Gimble, Capital		227,448.00						227,448.00
J.M. Gimble, Drawing	20,800.00						20,800.00
Income Summary			(a)	60,000.00	(b)	68,000.00	60,000.00	68,000.00
			(d)	2,560.00	(e)	3,440.00	2,560.00	3,440.00
Sales		420,112.00						420,112.00
Sales Returns and Allowances	11,600.00		(c)	1,760.00			13,360.00
Rent Revenue					(k)	3,520.00		3,520.00
Purchases	100,000.00						100,000.00
Purchases Returns and Allowances		1,120.00						1,120.00
Purchases Discounts		1,440.00						1,440.00
Freight-In	1,680.00						1,680.00
Wages Expense	100,000.00		(j)	2,800.00			102,800.00
Advertising Expense	10,400.00						10,400.00
Supplies Expense			(f)	3,760.00			3,760.00
Phone Expense	1,080.00						1,080.00
Utilities Expense	6,400.00						6,400.00
Insurance Expense			(g)	1,280.00			1,280.00
Depr. Expense—Building			(h)	10,000.00			10,000.00
Depr. Expense—Store Equipment			(f)	4,000.00			4,000.00
Rent Expense	48,000.00						48,000.00
	784,440.00	784,440.00		161,120.00		161,120.00	874,440.00	874,440.00
							365,320.00	497,632.00
Net Income							132,312.00

From the spreadsheet, identify the adjusting entry(ies) that should be reversed and prepare the reversing entry(ies).

Page: 1

	DATE	DEBIT	CREDIT
1	20-2 Jan. 1	fill in the blank 2	fill in the blank 3	1
2		fill in the blank 5	fill in the blank 6	2
3				3

Expert Solution

Step 1

Adjusting entries:
Adjusting entries can be defined as those journal entries that are being made at the end of the accounting year for the purpose adjusting the balance of the revenue and expenses account that has effect over more than one year. Adjusting journal entries are used for preparation of the adjusted trial balance.

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rom the spreadsheet, identify the adjusting entry(ies) that should be reversed and prepare the reversing entry(ies). Page: 1 DATE ACCOUNT TITLE DOC. NO. POST. REF. DEBIT CREDIT 1 20-2 Jan. 1 fill in the blank 2 fill in the blank 3 1 2 fill in the blank 5 fill in the blank 6 2 3 3