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Concept explainers
Cash versus accrual accounting;
• LO2–4, LO2–5, LO2–8
The Righter Shoe Store Company prepares monthly financial statements for its bank. The November 30 and December 31, 2018,
The following information also is known:
a. The December income statement reported $2,000 in supplies expense.
b. No insurance payments were made in December.
c. $10,000 was paid to employees during December for salaries and wages.
d. On November 1, 2018, a tenant paid Righter $3,000 in advance rent for the period November through January. Deferred rent revenue was credited.
Required:
1. What was the cost of supplies purchased during December?
2. What was the adjusting entry recorded at the end of December for prepaid insurance?
3. What was the adjusting entry recorded at the end of December for accrued salaries and wages?
4. What was the amount of rent revenue recognized in December? What adjusting entry was recorded at the end of December for deferred rent revenue?
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Chapter 2 Solutions
Intermediate Accounting
- Home Insert Draw Page Layout Formulas Data Review View Automate Developer Calibri (Body) 12 ✓ Α Αν Conditional Formatting ✓ ☑Insert v Σ Custom Paste B I U ✓ ✓ $ ✓ %9 0 .00 →0 Format as Table ✓ Cell Styles ▾ Delete ✓ Format ✓ C26 fx A B D E F G 1 Instruction: 2 1. Please complete the following budget plan using appropriate cell references format (the cells highlighted in grey) 3 2. Please use fill handler to complete the table. E.g. in cell C16, build one formula and generate other formulas to D16 and E16 with fill handler. 4 3. For "Cost of Goods Sold" section (before "COGS Subtotal"), build one formula in cell C19, and generate formulas until E21. Overhead (B21) is 20% (B10) of the labor cost (B20). 5 4. For "COGS Subtotal", build one formula in C22, and generate the formulas to E22. 6 5. Similar requirements for "Selling Expenses" and "Projected Earnings" section. 7 6. Please be noted, for all items under "Cost of Goods Sold", and "Selling Expenses" the cost is per ONE shoe, not per…arrow_forwardProvide correct solution and accountingarrow_forwardSolve this question accountingarrow_forward
- AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
- Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSONIntermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill EducationFinancial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education
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