Selected account balances from December 31, 2015, accounts balance of the Gracy Company are listed below: Balances: Inventory, January 1, 2015 $12,500 Purchases 25,000 Salaries Expense 5,000 Rent Expense 3,250 General and Admin Exp 2,500 Sales $61,000 Dividends Declared 3,500 In addition, the following information is available: ·$890 of salaries have accrued as of December 31. ·On March 30, Gracy purchased a 12-month insurance policy for $240. The purchase was debited to Prepaid Insurance. ·On December 1, the company paid 2 months' rent in advance. The $1500 payment was debited to Rent Expense. ·In December, a customer paid $1,000 in advance for merchandise that will be shipped by Gracy in 2016. The amount received was credited to Sales. ·Gracy estimates its bad debts to be 1% of sales (after all adjustments). ·The income tax rate is 30%. Required: Using a general journal format, prepare the required adjusting entries.
Selected account balances from December 31, 2015, accounts balance of the Gracy Company are listed below:
Balances:
Inventory, January 1, 2015 $12,500
Purchases 25,000
Salaries Expense 5,000
Rent Expense 3,250
General and Admin Exp 2,500
Sales $61,000
Dividends Declared 3,500
In addition, the following information is available:
·$890 of salaries have accrued as of December 31.
·On March 30, Gracy purchased a 12-month insurance policy for $240. The purchase was debited to Prepaid Insurance.
·On December 1, the company paid 2 months' rent in advance. The $1500 payment was debited to Rent Expense.
·In December, a customer paid $1,000 in advance for merchandise that will be shipped by Gracy in 2016. The amount received was credited to Sales.
·Gracy estimates its
·The income tax rate is 30%.
Required:
Using a general journal format, prepare the required
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