Selected account balances before adjustment for Atlantic Coast Realty at July 31, the end of the current year, are as follows: Credits Debits $ 75,000 345,700 Accounts Receivable Equipment Accumulated Depreciation-Equipment Prepaid Rent Supplies Wages Payable $112,500 9,000 3,350 Unearned Fees 12,000 Fees Earned 660,000 Wages Expense Rent Expense Depreciation Expense Supplies Expense 325,000 Data needed for year-end adjustments are as follows: • Unbilled fees at July 31, $11,150. • Supplies on hand at July 31, $900. • Rent expired, $6,000. • Depreciation of equipment during year, $8,950. • Unearned fees at July 31, $2,000. Wages accrued but not paid at July 31, $4,840. Instructions 1. Journalize the six adjusting entries required at July 31, based on the data presented. 2. What would be the effect on the income statement if the adjustments for unbilled fees and accrued wages were omitted at the end of the year? 3. What would be the effect on the balance sheet if the adjustments for unbilled fees and accrued wages were omitted at the end of the year? 4. What would be the effect on the "Net increase or decrease in cash" on the statement of cash flows if the adjustments for unbilled fees and accrued wages were omitted at the end of the year?
Selected account balances before adjustment for Atlantic Coast Realty at July 31, the end of the current year, are as follows: Credits Debits $ 75,000 345,700 Accounts Receivable Equipment Accumulated Depreciation-Equipment Prepaid Rent Supplies Wages Payable $112,500 9,000 3,350 Unearned Fees 12,000 Fees Earned 660,000 Wages Expense Rent Expense Depreciation Expense Supplies Expense 325,000 Data needed for year-end adjustments are as follows: • Unbilled fees at July 31, $11,150. • Supplies on hand at July 31, $900. • Rent expired, $6,000. • Depreciation of equipment during year, $8,950. • Unearned fees at July 31, $2,000. Wages accrued but not paid at July 31, $4,840. Instructions 1. Journalize the six adjusting entries required at July 31, based on the data presented. 2. What would be the effect on the income statement if the adjustments for unbilled fees and accrued wages were omitted at the end of the year? 3. What would be the effect on the balance sheet if the adjustments for unbilled fees and accrued wages were omitted at the end of the year? 4. What would be the effect on the "Net increase or decrease in cash" on the statement of cash flows if the adjustments for unbilled fees and accrued wages were omitted at the end of the year?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Selected account balances before adjustment for Atlantic Coast Realty at July 31, the end
of the current year, are as follows:
Credits
Debits
$ 75,000
345,700
Accounts Receivable
Equipment
Accumulated Depreciation-Equipment
Prepaid Rent
Supplies
Wages Payable
$112,500
9,000
3,350
Unearned Fees
12,000
Fees Earned
660,000
Wages Expense
Rent Expense
Depreciation Expense
Supplies Expense
325,000
Data needed for year-end adjustments are as follows:
• Unbilled fees at July 31, $11,150.
• Supplies on hand at July 31, $900.
• Rent expired, $6,000.
• Depreciation of equipment during year, $8,950.
• Unearned fees at July 31, $2,000.
Wages accrued but not paid at July 31, $4,840.
Transcribed Image Text:Instructions
1. Journalize the six adjusting entries required at July 31, based on the data presented.
2. What would be the effect on the income statement if the adjustments for unbilled fees
and accrued wages were omitted at the end of the year?
3. What would be the effect on the balance sheet if the adjustments for unbilled fees
and accrued wages were omitted at the end of the year?
4. What would be the effect on the "Net increase or decrease in cash" on the statement
of cash flows if the adjustments for unbilled fees and accrued wages were omitted at
the end of the year?
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