(Year-end adjusting journal entries) Prepare budgetary and proprietary journal entries to record the following year-end adjustments: 1. An accrual of $60,000 was made for salaries earned the last week of September, to be paid in Octo- ber. Budgetary funds were available for this purpose. 2. The agency's liability for unused vacation leave increased by $40,000 as a result of the year's activi- ties. The budget makes no provision for this expense until vacation leave is actually taken. 3. The agency discovered that a purchase order for $15,000 was inadvertently issued twice for the same thing. Therefore, one of the orders was cancelled. 4. The agency recorded depreciation of $25,000 on its equipment.

(Year-end adjusting journal entries) Prepare budgetary and proprietary journal entries to record the following year-end adjustments: 1. An accrual of $60,000 was made for salaries earned the last week of September, to be paid in Octo- ber. Budgetary funds were available for this purpose. 2. The agency's liability for unused vacation leave increased by $40,000 as a result of the year's activi- ties. The budget makes no provision for this expense until vacation leave is actually taken. 3. The agency discovered that a purchase order for $15,000 was inadvertently issued twice for the same thing. Therefore, one of the orders was cancelled. 4. The agency recorded depreciation of $25,000 on its equipment.

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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Concept explainers

Master Budget

A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.

Sales Budget and Selling

A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.

Question

(Year-end adjusting journal entries)
Prepare budgetary and proprietary journal entries to record the following year-end adjustments:
1. An accrual of $60,000 was made for salaries earned the last week of September, to be paid in Octo-
ber. Budgetary funds were available for this purpose.
2. The agency's liability for unused vacation leave increased by $40,000 as a result of the year's activi-
ties. The budget makes no provision for this expense until vacation leave is actually taken.
3. The agency discovered that a purchase order for $15,000 was inadvertently issued twice for the same
thing. Therefore, one of the orders was cancelled.
4. The agency recorded depreciation of $25,000 on its equipment.

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