The following information is available for M&M Johnson Inc.: The December 31, 2020, supplies inventory balance is $85,000. A count of supplies reveals that the company actually has $30,000 of supplies on hand. As of December 31, 2020, Johnson Inc. had not paid the rent for December. The monthly rent is $2,400. On December 20, 2020, Johnson collected $18,000 in customer advances for the subsequent performance of a service. Johnson recorded the $18,000 as unearned revenue, and as of December 31 two-thirds of the service had been performed. The total cost of Johnson’s fixed assets is $500,000. Johnson estimates that the assets have a useful life of ten years with zero salvage value and uses the straight-line method of depreciation. Johnson borrowed $10,000 at an annual rate of 12 percent on July 1, 2020. The first interest payment will be made on January 1, 2021. Johnson placed several ads in local newspapers during December. On December 31, the company received a $28,000 bill for the ads, which was not recorded at the time the company placed the ads. On July 1, 2020, Johnson paid the premium for a one-year life insurance policy. The $350 cost of the premium was capitalized as an asset when paid. Prepare the adjusting journal entries necessary for the 12 months ended December 31, 2020. 5- In adjusting entry g what is the amount of Insurance Expense?
The following information is available for M&M Johnson Inc.: The December 31, 2020, supplies inventory balance is $85,000. A count of supplies reveals that the company actually has $30,000 of supplies on hand. As of December 31, 2020, Johnson Inc. had not paid the rent for December. The monthly rent is $2,400. On December 20, 2020, Johnson collected $18,000 in customer advances for the subsequent performance of a service. Johnson recorded the $18,000 as unearned revenue, and as of December 31 two-thirds of the service had been performed. The total cost of Johnson’s fixed assets is $500,000. Johnson estimates that the assets have a useful life of ten years with zero salvage value and uses the straight-line method of depreciation. Johnson borrowed $10,000 at an annual rate of 12 percent on July 1, 2020. The first interest payment will be made on January 1, 2021. Johnson placed several ads in local newspapers during December. On December 31, the company received a $28,000 bill for the ads, which was not recorded at the time the company placed the ads. On July 1, 2020, Johnson paid the premium for a one-year life insurance policy. The $350 cost of the premium was capitalized as an asset when paid. Prepare the adjusting journal entries necessary for the 12 months ended December 31, 2020. 5- In adjusting entry g what is the amount of Insurance Expense?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
The following information is available for M&M Johnson Inc.:
- The December 31, 2020, supplies inventory balance is $85,000. A count of supplies reveals that the company actually has $30,000 of supplies on hand.
- As of December 31, 2020, Johnson Inc. had not paid the rent for December. The monthly rent is $2,400.
- On December 20, 2020, Johnson collected $18,000 in customer advances for the subsequent performance of a service. Johnson recorded the $18,000 as unearned revenue, and as of December 31 two-thirds of the service had been performed.
- The total cost of Johnson’s fixed assets is $500,000. Johnson estimates that the assets have a useful life of ten years with zero salvage value and uses the straight-line method of
depreciation. - Johnson borrowed $10,000 at an annual rate of 12 percent on July 1, 2020. The first interest payment will be made on January 1, 2021.
- Johnson placed several ads in local newspapers during December. On December 31, the company received a $28,000 bill for the ads, which was not recorded at the time the company placed the ads.
- On July 1, 2020, Johnson paid the premium for a one-year life insurance policy. The $350 cost of the premium was capitalized as an asset when paid.
Prepare the
5- In adjusting entry g what is the amount of Insurance Expense?
Expert Solution
![](/static/compass_v2/shared-icons/check-mark.png)
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
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.Recommended textbooks for you
![FINANCIAL ACCOUNTING](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781259964947/9781259964947_smallCoverImage.jpg)
![Accounting](https://www.bartleby.com/isbn_cover_images/9781337272094/9781337272094_smallCoverImage.gif)
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
![Accounting Information Systems](https://www.bartleby.com/isbn_cover_images/9781337619202/9781337619202_smallCoverImage.gif)
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
![FINANCIAL ACCOUNTING](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781259964947/9781259964947_smallCoverImage.jpg)
![Accounting](https://www.bartleby.com/isbn_cover_images/9781337272094/9781337272094_smallCoverImage.gif)
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
![Accounting Information Systems](https://www.bartleby.com/isbn_cover_images/9781337619202/9781337619202_smallCoverImage.gif)
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
![Horngren's Cost Accounting: A Managerial Emphasis…](https://www.bartleby.com/isbn_cover_images/9780134475585/9780134475585_smallCoverImage.gif)
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
![Intermediate Accounting](https://www.bartleby.com/isbn_cover_images/9781259722660/9781259722660_smallCoverImage.gif)
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
![Financial and Managerial Accounting](https://www.bartleby.com/isbn_cover_images/9781259726705/9781259726705_smallCoverImage.gif)
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education