a Prepare adjusting entries on December 31, 2021, for Simple Company for the following1 Accrue the interest on the 10-year bonds payable which were sold on May 1, 2022, andpay 8% interest annually on April 30 each year.2 Estimated $800 of bad debts from customers this year.3$3,200 of prepaid insurance was used up4 Accrued $700 of wages at the end of the year5this year.Estimated one year depreciation on the operating equipment assuming a 10 year life anda $12,000 salvage value and the straight line method of depreciation.6 Merchandise Inventory on December 31, 2021, was $61,000.b Prepare a classified balance sheet for Simple Company as of December 31, 2021, includingthe effects of your six adjusting entries. You may have created some new balance sheet accountswith your adjusting entries above. Please include these new accounts. Remember if you changeincome statement accounts in adjusting entries, you also have to change retained earnings. Ignoreany income taxes related to the adjusting entries. Simple Company had the following balances on December 31, 2021, BEFORE preparing adjusting entries.CreditEquipment (used in operating Simple Company)Accounts ReceivableMerchandise InventoryGoodwillEquipment (rented to another company)Available for Sale SecuritiesCashPatentDebt Retirement FundTrademarkPrepaid InsuranceCommon Stock, $10 par, 40,000 shares authorized, 15,000 shares issued and outstandingBonds PayableRetained EarningsAccumulated Depreciation - Operating EquipmentAccounts PayablePaid in Capital in Excess of ParPremium on Bonds PayableAccumulated Depreciation - Rented EquipmentUnearned SalesDebit$174,00062,00057,00036,00031,00018,00015,00011,0008,0005,0004,000Cash Dividends PayableAllowance for Doubtful Accounts$421,000$150,00090,00084,00042,00019,00014,0006,0006,0005,0003,5001,500$421,000

Name: a Prepare adjusting entries on December 31, 2021, for Simple Company
Uploaded: 2024-03-05T11:47:04.000Z
Channel: Bartleby
Description: a Prepare adjusting entries on December 31, 2021, for Simple Company for the following1 Accrue the interest on the 10-year bonds payable which were sold on May 1, 2022, andpay 8% interest annually on April 30 each year.2 Estimated $800 of bad debts

Adjusting entries are made at the end of the year to record the accrued expenses and income along…

Business

Accounting

Simple Company had the following balances on December 31, 2021, BEFORE preparing adjusting entries. Credit Equipment (used in operating Simple Company) Accounts Receivable Merchandise Inventory Goodwill Equipment (rented to another company) Available for Sale Securities Cash Patent Debt Retirement Fund Accumulated Depreciation - Operating Equipment Accounts Payable Trademark Prepaid Insurance Common Stock, $10 par, 40,000 shares authorized, 15,000 shares issued and outstanding Bonds Payable Retained Earnings Paid in Capital in Excess of Par Premium on Bonds Payable Accumulated Depreciation - Rented Equipment Unearned Sales Debit $174,000 62,000 57,000 36,000 31,000 Cash Dividends Payable Allowance for Doubtful Accounts 18,000 15,000 11,000 8,000 5,000 4,000 $421,000 $150,000 90,000 84,000 42,000 19,000 14,000 6,000 6,000 5,000 3,500 1,500 $421,000

Simple Company had the following balances on December 31, 2021, BEFORE preparing adjusting entries. Credit Equipment (used in operating Simple Company) Accounts Receivable Merchandise Inventory Goodwill Equipment (rented to another company) Available for Sale Securities Cash Patent Debt Retirement Fund Accumulated Depreciation - Operating Equipment Accounts Payable Trademark Prepaid Insurance Common Stock, $10 par, 40,000 shares authorized, 15,000 shares issued and outstanding Bonds Payable Retained Earnings Paid in Capital in Excess of Par Premium on Bonds Payable Accumulated Depreciation - Rented Equipment Unearned Sales Debit $174,000 62,000 57,000 36,000 31,000 Cash Dividends Payable Allowance for Doubtful Accounts 18,000 15,000 11,000 8,000 5,000 4,000 $421,000 $150,000 90,000 84,000 42,000 19,000 14,000 6,000 6,000 5,000 3,500 1,500 $421,000

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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