Adjustment entries : Adjusting entries are those entries which are made at the end of the year to update the all balances in the financial statements to show the true financial information and to maintain the records according to accrual basis principle. Accrual basis principle: According to this principle of accounting, revenue should be recognized at the time when it is earned, doesn’t matter, it is received or not and expense should be recognized when it is incurred, doesn’t matter it is paid or not. The need for adjustment entry for prepaid insurance.

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Answer 1

Question

Chapter 3, Problem 3.1BE

(a)

To determine

Adjustment entries: Adjusting entries are those entries which are made at the end of the year to update the all balances in the financial statements to show the true financial information and to maintain the records according to accrual basis principle.

Accrual basis principle: According to this principle of accounting, revenue should be recognized at the time when it is earned, doesn’t matter, it is received or not and expense should be recognized when it is incurred, doesn’t matter it is paid or not.

The need for adjustment entry for prepaid insurance.

(b)

To determine

The need for adjustment entry for depreciation expense

(c)

To determine

The need for adjustment entry for unearned service revenue

(d)

To determine

The need for adjustment entry for interest payable

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Answer 2

Question

Chapter 3, Problem 3.1BE

(a)

To determine

Adjustment entries: Adjusting entries are those entries which are made at the end of the year to update the all balances in the financial statements to show the true financial information and to maintain the records according to accrual basis principle.

Accrual basis principle: According to this principle of accounting, revenue should be recognized at the time when it is earned, doesn’t matter, it is received or not and expense should be recognized when it is incurred, doesn’t matter it is paid or not.

The need for adjustment entry for prepaid insurance.

(b)

To determine

The need for adjustment entry for depreciation expense

(c)

To determine

The need for adjustment entry for unearned service revenue

(d)

To determine

The need for adjustment entry for interest payable

Expert Solution & Answer

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See solution

Answer 3

Question

Chapter 3, Problem 3.1BE

(a)

To determine

Adjustment entries: Adjusting entries are those entries which are made at the end of the year to update the all balances in the financial statements to show the true financial information and to maintain the records according to accrual basis principle.

Accrual basis principle: According to this principle of accounting, revenue should be recognized at the time when it is earned, doesn’t matter, it is received or not and expense should be recognized when it is incurred, doesn’t matter it is paid or not.

The need for adjustment entry for prepaid insurance.

(b)

To determine

The need for adjustment entry for depreciation expense

(c)

To determine

The need for adjustment entry for unearned service revenue

(d)

To determine

The need for adjustment entry for interest payable

Expert Solution & Answer

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Answer 4

Question

Chapter 3, Problem 3.1BE

(a)

To determine

Adjustment entries: Adjusting entries are those entries which are made at the end of the year to update the all balances in the financial statements to show the true financial information and to maintain the records according to accrual basis principle.

Accrual basis principle: According to this principle of accounting, revenue should be recognized at the time when it is earned, doesn’t matter, it is received or not and expense should be recognized when it is incurred, doesn’t matter it is paid or not.

The need for adjustment entry for prepaid insurance.

(b)

To determine

The need for adjustment entry for depreciation expense

(c)

To determine

The need for adjustment entry for unearned service revenue

(d)

To determine

The need for adjustment entry for interest payable

Expert Solution & Answer

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Answer 5

Chapter 3, Problem 3.1BE

(a)

To determine

Adjustment entries: Adjusting entries are those entries which are made at the end of the year to update the all balances in the financial statements to show the true financial information and to maintain the records according to accrual basis principle.

Accrual basis principle: According to this principle of accounting, revenue should be recognized at the time when it is earned, doesn’t matter, it is received or not and expense should be recognized when it is incurred, doesn’t matter it is paid or not.

The need for adjustment entry for prepaid insurance.

(b)

To determine

The need for adjustment entry for depreciation expense

(c)

To determine

The need for adjustment entry for unearned service revenue

(d)

To determine

The need for adjustment entry for interest payable

Answer 6

Chapter 3, Problem 3.1BE

(a)

To determine

Adjustment entries: Adjusting entries are those entries which are made at the end of the year to update the all balances in the financial statements to show the true financial information and to maintain the records according to accrual basis principle.

Accrual basis principle: According to this principle of accounting, revenue should be recognized at the time when it is earned, doesn’t matter, it is received or not and expense should be recognized when it is incurred, doesn’t matter it is paid or not.

The need for adjustment entry for prepaid insurance.

Answer 7

Chapter 3, Problem 3.1BE

(a)

To determine

Adjustment entries: Adjusting entries are those entries which are made at the end of the year to update the all balances in the financial statements to show the true financial information and to maintain the records according to accrual basis principle.

Accrual basis principle: According to this principle of accounting, revenue should be recognized at the time when it is earned, doesn’t matter, it is received or not and expense should be recognized when it is incurred, doesn’t matter it is paid or not.

The need for adjustment entry for prepaid insurance.

Answer 8

(b)

To determine

The need for adjustment entry for depreciation expense

Answer 9

(b)

To determine

The need for adjustment entry for depreciation expense

Answer 10

(c)

To determine

The need for adjustment entry for unearned service revenue

Answer 11

(c)

To determine

The need for adjustment entry for unearned service revenue

Answer 12

(d)

To determine

The need for adjustment entry for interest payable

Answer 13

(d)

To determine

The need for adjustment entry for interest payable

Answer 14

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Answer 15

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Answer 16

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Answer 17

Ch. 3 - Prob. 1Q Ch. 3 - 2. Define two generally accepted accounting...Ch. 3 - 3.Susan Zupan, a lawyer, accepts a legal...Ch. 3 - 4.Why do accrual-basis financial statements...Ch. 3 - 5.In completing the engagement in Question 3,...Ch. 3 - Prob. 6Q Ch. 3 - Prob. 7Q Ch. 3 - Prob. 8Q Ch. 3 - 9. What is the debit/credit effect of a prepaid...Ch. 3 - Prob. 10Q

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