Adjusting entries : Adjusting entries are the journal entries , which are recorded at the end of the accounting period to correct or adjust the revenue and expense accounts, to concede with the accrual principle of accounting. Accounting rules for journal/adjusting entries : To record increase balance of account : Debit assets, expenses, losses and credit liabilities, capital, revenue and gains. To record decrease balance of account : Credit assets, expenses, losses and debit liabilities, capital, revenue and gains. Reversing Entries: Reversing entries are made at the beginning of the accounting period when the accountant needs to cancel any entry made in the previous accounting period. It is done in order to eliminate any errors that might have occurred in the calculation of the revenue or expenses and henceforth increase the efficiency of the financial statements for an improved decision-making. To Identify: The adjusting entries which would likely to be reversed at the beginning of the following year, if Company M’s accountant has employed reversing entries for accruals.

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Answer 1

Question

Chapter 2, Problem 2.22E

1.

To determine

Adjusting entries:

Adjusting entries are the journal entries, which are recorded at the end of the accounting period to correct or adjust the revenue and expense accounts, to concede with the accrual principle of accounting.

Accounting rules for journal/adjusting entries:

To record increase balance of account: Debit assets, expenses, losses and credit liabilities, capital, revenue and gains.

To record decrease balance of account: Credit assets, expenses, losses and debit liabilities, capital, revenue and gains.

Reversing Entries:

Reversing entries are made at the beginning of the accounting period when the accountant needs to cancel any entry made in the previous accounting period. It is done in order to eliminate any errors that might have occurred in the calculation of the revenue or expenses and henceforth increase the efficiency of the financial statements for an improved decision-making.

To Identify: The adjusting entries which would likely to be reversed at the beginning of the following year, if Company M’s accountant has employed reversing entries for accruals.

2.

To determine

To Prepare: The adjusting entries at the end of 2016 for the adjustments identified above.

3.

To determine

To Prepare: The appropriate reversing entries at the beginning of 2017.

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Answer 2

Question

Chapter 2, Problem 2.22E

1.

To determine

Adjusting entries:

Adjusting entries are the journal entries, which are recorded at the end of the accounting period to correct or adjust the revenue and expense accounts, to concede with the accrual principle of accounting.

Accounting rules for journal/adjusting entries:

To record increase balance of account: Debit assets, expenses, losses and credit liabilities, capital, revenue and gains.

To record decrease balance of account: Credit assets, expenses, losses and debit liabilities, capital, revenue and gains.

Reversing Entries:

Reversing entries are made at the beginning of the accounting period when the accountant needs to cancel any entry made in the previous accounting period. It is done in order to eliminate any errors that might have occurred in the calculation of the revenue or expenses and henceforth increase the efficiency of the financial statements for an improved decision-making.

To Identify: The adjusting entries which would likely to be reversed at the beginning of the following year, if Company M’s accountant has employed reversing entries for accruals.

2.

To determine

To Prepare: The adjusting entries at the end of 2016 for the adjustments identified above.

3.

To determine

To Prepare: The appropriate reversing entries at the beginning of 2017.

Expert Solution & Answer

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Answer 3

Question

Chapter 2, Problem 2.22E

1.

To determine

Adjusting entries:

Adjusting entries are the journal entries, which are recorded at the end of the accounting period to correct or adjust the revenue and expense accounts, to concede with the accrual principle of accounting.

Accounting rules for journal/adjusting entries:

To record increase balance of account: Debit assets, expenses, losses and credit liabilities, capital, revenue and gains.

To record decrease balance of account: Credit assets, expenses, losses and debit liabilities, capital, revenue and gains.

Reversing Entries:

Reversing entries are made at the beginning of the accounting period when the accountant needs to cancel any entry made in the previous accounting period. It is done in order to eliminate any errors that might have occurred in the calculation of the revenue or expenses and henceforth increase the efficiency of the financial statements for an improved decision-making.

To Identify: The adjusting entries which would likely to be reversed at the beginning of the following year, if Company M’s accountant has employed reversing entries for accruals.

2.

To determine

To Prepare: The adjusting entries at the end of 2016 for the adjustments identified above.

3.

To determine

To Prepare: The appropriate reversing entries at the beginning of 2017.

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Answer 4

Question

Chapter 2, Problem 2.22E

1.

To determine

Adjusting entries:

Adjusting entries are the journal entries, which are recorded at the end of the accounting period to correct or adjust the revenue and expense accounts, to concede with the accrual principle of accounting.

Accounting rules for journal/adjusting entries:

To record increase balance of account: Debit assets, expenses, losses and credit liabilities, capital, revenue and gains.

To record decrease balance of account: Credit assets, expenses, losses and debit liabilities, capital, revenue and gains.

Reversing Entries:

Reversing entries are made at the beginning of the accounting period when the accountant needs to cancel any entry made in the previous accounting period. It is done in order to eliminate any errors that might have occurred in the calculation of the revenue or expenses and henceforth increase the efficiency of the financial statements for an improved decision-making.

To Identify: The adjusting entries which would likely to be reversed at the beginning of the following year, if Company M’s accountant has employed reversing entries for accruals.

2.

To determine

To Prepare: The adjusting entries at the end of 2016 for the adjustments identified above.

3.

To determine

To Prepare: The appropriate reversing entries at the beginning of 2017.

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Answer 5

Chapter 2, Problem 2.22E

1.

To determine

Adjusting entries:

Adjusting entries are the journal entries, which are recorded at the end of the accounting period to correct or adjust the revenue and expense accounts, to concede with the accrual principle of accounting.

Accounting rules for journal/adjusting entries:

To record increase balance of account: Debit assets, expenses, losses and credit liabilities, capital, revenue and gains.

To record decrease balance of account: Credit assets, expenses, losses and debit liabilities, capital, revenue and gains.

Reversing Entries:

Reversing entries are made at the beginning of the accounting period when the accountant needs to cancel any entry made in the previous accounting period. It is done in order to eliminate any errors that might have occurred in the calculation of the revenue or expenses and henceforth increase the efficiency of the financial statements for an improved decision-making.

To Identify: The adjusting entries which would likely to be reversed at the beginning of the following year, if Company M’s accountant has employed reversing entries for accruals.

2.

To determine

To Prepare: The adjusting entries at the end of 2016 for the adjustments identified above.

3.

To determine

To Prepare: The appropriate reversing entries at the beginning of 2017.

Answer 6

Chapter 2, Problem 2.22E

1.

To determine

Adjusting entries:

Adjusting entries are the journal entries, which are recorded at the end of the accounting period to correct or adjust the revenue and expense accounts, to concede with the accrual principle of accounting.

Accounting rules for journal/adjusting entries:

To record increase balance of account: Debit assets, expenses, losses and credit liabilities, capital, revenue and gains.

To record decrease balance of account: Credit assets, expenses, losses and debit liabilities, capital, revenue and gains.

Reversing Entries:

Reversing entries are made at the beginning of the accounting period when the accountant needs to cancel any entry made in the previous accounting period. It is done in order to eliminate any errors that might have occurred in the calculation of the revenue or expenses and henceforth increase the efficiency of the financial statements for an improved decision-making.

To Identify: The adjusting entries which would likely to be reversed at the beginning of the following year, if Company M’s accountant has employed reversing entries for accruals.

Answer 7

Chapter 2, Problem 2.22E

1.

To determine

Adjusting entries:

Adjusting entries are the journal entries, which are recorded at the end of the accounting period to correct or adjust the revenue and expense accounts, to concede with the accrual principle of accounting.

Accounting rules for journal/adjusting entries:

To record increase balance of account: Debit assets, expenses, losses and credit liabilities, capital, revenue and gains.

To record decrease balance of account: Credit assets, expenses, losses and debit liabilities, capital, revenue and gains.

Reversing Entries:

Reversing entries are made at the beginning of the accounting period when the accountant needs to cancel any entry made in the previous accounting period. It is done in order to eliminate any errors that might have occurred in the calculation of the revenue or expenses and henceforth increase the efficiency of the financial statements for an improved decision-making.

To Identify: The adjusting entries which would likely to be reversed at the beginning of the following year, if Company M’s accountant has employed reversing entries for accruals.

Answer 8

2.

To determine

To Prepare: The adjusting entries at the end of 2016 for the adjustments identified above.

Answer 9

2.

To determine

To Prepare: The adjusting entries at the end of 2016 for the adjustments identified above.

Answer 10

3.

To determine

To Prepare: The appropriate reversing entries at the beginning of 2017.

Answer 11

3.

To determine

To Prepare: The appropriate reversing entries at the beginning of 2017.

Answer 12

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Answer 13

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Answer 14

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Answer 15

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To Prepare: The adjusting entries at the end of 2016 for the adjustments identified above.

To Prepare: The appropriate reversing entries at the beginning of 2017.

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