Exercise 5.1 (Algo) Calculating adjustments. LO 5-2On June 1, 20X1, Keller Company, a new firm, paid $5,280 rent in advance for a six-month period. The $5,280 was debited to the Prepaid Rent account.On June 1, 20X1, the firm bought supplies for $7,350. The $7,350 was debited to the Supplies account. An inventory of supplies at the end of June showed that items costing $3,000 were on hand.On June 1, 20X1, the firm bought equipment costing $57,600. The equipment has an expected useful life of 10 years and no salvage value. The firm will use the straight-line method of depreciation.Prepare end-of-June adjusting entries for Keller Company.- Prepare the adjusting entry for prepaid rent.- Prepare the adjusting entry for supplies.- Prepare the adjusting entry for depreciation. ### Exercise 5.1 (Algo) Calculating Adjustments. LO 5-21. **Prepaid Rent Transaction**: - On June 1, 20X1, Keller Company, a new firm, paid $5,280 in rent in advance for a six-month period. This amount was debited to the Prepaid Rent account.2. **Supplies Transaction**: - On June 1, 20X1, the firm purchased supplies worth $7,350, which was debited to the Supplies account. An inventory taken at the end of June indicated that supplies worth $3,000 were still on hand.3. **Equipment Transaction**: - On June 1, 20X1, the company bought equipment for $57,600. This equipment has an expected useful life of 10 years and no salvage value. Keller Company plans to use the straight-line method for depreciation.**Task**: Prepare the adjusting entries for Keller Company at the end of June.#### Journal Entry Worksheet- **Instructions**: Prepare the adjusting entry for prepaid rent. Ensure that debits are entered before credits.**Journal Entries**| Transaction | General Journal | Debit | Credit ||-------------|-----------------|--------|--------|| 1 | Prepaid Rent | $5,280 | || | Cash | | $5,280 |**Note**: This worksheet helps to organize the information for financial adjustments due at the month's end. The goal is to accurately reflect the company's financial situation.

Name: Exercise 5.1 (Algo) Calculating adjustments. LO 5-2On June 1, 20X1, Ke
Uploaded: 2024-03-05T11:50:36.000Z
Channel: Bartleby
Description: Exercise 5.1 (Algo) Calculating adjustments. LO 5-2On June 1, 20X1, Keller Company, a new firm, paid $5,280 rent in advance for a six-month period. The $5,280 was debited to the Prepaid Rent account.On June 1, 20X1, the firm bought supplies for $7,35

Adjusting entries are used to record unrecorded transactions for accrued revenues and expenses,…

Answered: the firm bought equipment costing…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Exercise 5.1 (Algo) Calculating adjustments. LO 5-2

On June 1, 20X1, Keller Company, a new firm, paid $5,280 rent in advance for a six-month period. The $5,280 was debited to the Prepaid Rent account.
On June 1, 20X1, the firm bought supplies for $7,350. The $7,350 was debited to the Supplies account. An inventory of supplies at the end of June showed that items costing $3,000 were on hand.
On June 1, 20X1, the firm bought equipment costing $57,600. The equipment has an expected useful life of 10 years and no salvage value. The firm will use the straight-line method of depreciation.

Prepare end-of-June adjusting entries for Keller Company.

- Prepare the adjusting entry for prepaid rent.

- Prepare the adjusting entry for supplies.

- Prepare the adjusting entry for depreciation.

### Exercise 5.1 (Algo) Calculating Adjustments. LO 5-2

1. **Prepaid Rent Transaction**:
- On June 1, 20X1, Keller Company, a new firm, paid $5,280 in rent in advance for a six-month period. This amount was debited to the Prepaid Rent account.

2. **Supplies Transaction**:
- On June 1, 20X1, the firm purchased supplies worth $7,350, which was debited to the Supplies account. An inventory taken at the end of June indicated that supplies worth $3,000 were still on hand.

3. **Equipment Transaction**:
- On June 1, 20X1, the company bought equipment for $57,600. This equipment has an expected useful life of 10 years and no salvage value. Keller Company plans to use the straight-line method for depreciation.

**Task**: Prepare the adjusting entries for Keller Company at the end of June.

#### Journal Entry Worksheet

- **Instructions**: Prepare the adjusting entry for prepaid rent. Ensure that debits are entered before credits.

**Journal Entries**

| Transaction | General Journal | Debit | Credit |
|-------------|-----------------|--------|--------|
| 1 | Prepaid Rent | $5,280 | |
| | Cash | | $5,280 |

**Note**: This worksheet helps to organize the information for financial adjustments due at the month's end. The goal is to accurately reflect the company's financial situation.

Expert Solution

Trending now

This is a popular solution!

Step by step

Solved in 3 steps

SEE SOLUTION Check out a sample Q&A here

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.

Similar questions