Prepaid expenses - Prepaid expenses are part of accounting adjustment entries which are recorded in the closing period of the entity. These are those expenses which have not yet incurred but have been paid in advance. These are recorded in the books following the matching principle of accounting. To determine: 1. The current account balance, 2. The current account balance, and 3. The necessary adjusting entry as on December 31.

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Answer 1

Question

Chapter 3, Problem 5QS

To determine

Concept Introduction:

Prepaid expenses - Prepaid expenses are part of accounting adjustment entries which are recorded in the closing period of the entity. These are those expenses which have not yet incurred but have been paid in advance. These are recorded in the books following the matching principle of accounting.

To determine:

1. The current account balance,

2. The current account balance, and

3. The necessary adjusting entry as on December 31.

Expert Solution & Answer

Explanation of Solution

a.
1. The current prepaid insurance account balance = $4,700

2. The prepaid insurance account balance as on Dec.31 = $ 900

3. The adjustment entry

Particulars	Debit	Credit
Insurance expense	3,800
To Prepaid Insurance Account		3,800

b.
1. The current prepaid insurance account balance = $5,890
2. The prepaid insurance account balance as on Dec.31 = $ 4,850
3. The adjustment entry

Particulars	Debit	Credit
Insurance expense	1,040
To Prepaid Insurance Account		1,040

$\begin{array}{l} W o r k i n g : \\ \Pr e p a i d I n s u r a n c e a c c o u n t b a l a n c e a s o n D e c .31 = B a l a n c e i n t h e s t a r t - P o l i c i e s \exp i r e d \\ = 5, 890 - 1, 040 \\ = 4, 850 \end{array}$

c.
1. The current prepaid rent account balance = $24,000
2. The prepaid rent account balance as on Dec.31 = $ 20,000
3. The adjustment entry

Particulars	Debit	Credit
Rent expense	4,000
To Prepaid Rent Account		4,000

$\begin{array}{l} W o r k i n g : \\ \Pr e p a i d r e n t a c c o u n t b a l a n c e a s o n D e c .31 = B a l a n c e i n t h e s t a r t - Re n t p e r i o d \exp i r e d \\ = 24, 000 - (24, 000 \times 4 / 24) \\ = 20, 000 \end{array}$

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Students have asked these similar questions

The standard cost of Product ZT includes 3.5 hours of direct labor at $16 per hour. The predetermined overhead rate is $28 per direct labor hour. During August, the company incurred 5,100 hours of direct labor at an average rate of $15.75 per hour and $148,400 of manufacturing overhead costs. It produced 1,400 units. Compute the total overhead variance.

Please explain the solution to this general accounting problem using the correct accounting principles.

What was the company's total revenue for the year?

Answer 2

Question

Chapter 3, Problem 5QS

To determine

Concept Introduction:

Prepaid expenses - Prepaid expenses are part of accounting adjustment entries which are recorded in the closing period of the entity. These are those expenses which have not yet incurred but have been paid in advance. These are recorded in the books following the matching principle of accounting.

To determine:

1. The current account balance,

2. The current account balance, and

3. The necessary adjusting entry as on December 31.

Expert Solution & Answer

Explanation of Solution

a.
1. The current prepaid insurance account balance = $4,700

2. The prepaid insurance account balance as on Dec.31 = $ 900

3. The adjustment entry

Particulars	Debit	Credit
Insurance expense	3,800
To Prepaid Insurance Account		3,800

b.
1. The current prepaid insurance account balance = $5,890
2. The prepaid insurance account balance as on Dec.31 = $ 4,850
3. The adjustment entry

Particulars	Debit	Credit
Insurance expense	1,040
To Prepaid Insurance Account		1,040

$\begin{array}{l} W o r k i n g : \\ \Pr e p a i d I n s u r a n c e a c c o u n t b a l a n c e a s o n D e c .31 = B a l a n c e i n t h e s t a r t - P o l i c i e s \exp i r e d \\ = 5, 890 - 1, 040 \\ = 4, 850 \end{array}$

c.
1. The current prepaid rent account balance = $24,000
2. The prepaid rent account balance as on Dec.31 = $ 20,000
3. The adjustment entry

Particulars	Debit	Credit
Rent expense	4,000
To Prepaid Rent Account		4,000

$\begin{array}{l} W o r k i n g : \\ \Pr e p a i d r e n t a c c o u n t b a l a n c e a s o n D e c .31 = B a l a n c e i n t h e s t a r t - Re n t p e r i o d \exp i r e d \\ = 24, 000 - (24, 000 \times 4 / 24) \\ = 20, 000 \end{array}$

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Answer 3

Question

Chapter 3, Problem 5QS

To determine

Concept Introduction:

Prepaid expenses - Prepaid expenses are part of accounting adjustment entries which are recorded in the closing period of the entity. These are those expenses which have not yet incurred but have been paid in advance. These are recorded in the books following the matching principle of accounting.

To determine:

1. The current account balance,

2. The current account balance, and

3. The necessary adjusting entry as on December 31.

Expert Solution & Answer

Explanation of Solution

a.
1. The current prepaid insurance account balance = $4,700

2. The prepaid insurance account balance as on Dec.31 = $ 900

3. The adjustment entry

Particulars	Debit	Credit
Insurance expense	3,800
To Prepaid Insurance Account		3,800

b.
1. The current prepaid insurance account balance = $5,890
2. The prepaid insurance account balance as on Dec.31 = $ 4,850
3. The adjustment entry

Particulars	Debit	Credit
Insurance expense	1,040
To Prepaid Insurance Account		1,040

$\begin{array}{l} W o r k i n g : \\ \Pr e p a i d I n s u r a n c e a c c o u n t b a l a n c e a s o n D e c .31 = B a l a n c e i n t h e s t a r t - P o l i c i e s \exp i r e d \\ = 5, 890 - 1, 040 \\ = 4, 850 \end{array}$

c.
1. The current prepaid rent account balance = $24,000
2. The prepaid rent account balance as on Dec.31 = $ 20,000
3. The adjustment entry

Particulars	Debit	Credit
Rent expense	4,000
To Prepaid Rent Account		4,000

$\begin{array}{l} W o r k i n g : \\ \Pr e p a i d r e n t a c c o u n t b a l a n c e a s o n D e c .31 = B a l a n c e i n t h e s t a r t - Re n t p e r i o d \exp i r e d \\ = 24, 000 - (24, 000 \times 4 / 24) \\ = 20, 000 \end{array}$

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Answer 4

Question

Chapter 3, Problem 5QS

To determine

Concept Introduction:

Prepaid expenses - Prepaid expenses are part of accounting adjustment entries which are recorded in the closing period of the entity. These are those expenses which have not yet incurred but have been paid in advance. These are recorded in the books following the matching principle of accounting.

To determine:

1. The current account balance,

2. The current account balance, and

3. The necessary adjusting entry as on December 31.

Expert Solution & Answer

Explanation of Solution

a.
1. The current prepaid insurance account balance = $4,700

2. The prepaid insurance account balance as on Dec.31 = $ 900

3. The adjustment entry

Particulars	Debit	Credit
Insurance expense	3,800
To Prepaid Insurance Account		3,800

b.
1. The current prepaid insurance account balance = $5,890
2. The prepaid insurance account balance as on Dec.31 = $ 4,850
3. The adjustment entry

Particulars	Debit	Credit
Insurance expense	1,040
To Prepaid Insurance Account		1,040

$\begin{array}{l} W o r k i n g : \\ \Pr e p a i d I n s u r a n c e a c c o u n t b a l a n c e a s o n D e c .31 = B a l a n c e i n t h e s t a r t - P o l i c i e s \exp i r e d \\ = 5, 890 - 1, 040 \\ = 4, 850 \end{array}$

c.
1. The current prepaid rent account balance = $24,000
2. The prepaid rent account balance as on Dec.31 = $ 20,000
3. The adjustment entry

Particulars	Debit	Credit
Rent expense	4,000
To Prepaid Rent Account		4,000

$\begin{array}{l} W o r k i n g : \\ \Pr e p a i d r e n t a c c o u n t b a l a n c e a s o n D e c .31 = B a l a n c e i n t h e s t a r t - Re n t p e r i o d \exp i r e d \\ = 24, 000 - (24, 000 \times 4 / 24) \\ = 20, 000 \end{array}$

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Answer 5

Chapter 3, Problem 5QS

To determine

Concept Introduction:

Prepaid expenses - Prepaid expenses are part of accounting adjustment entries which are recorded in the closing period of the entity. These are those expenses which have not yet incurred but have been paid in advance. These are recorded in the books following the matching principle of accounting.

To determine:

1. The current account balance,

2. The current account balance, and

3. The necessary adjusting entry as on December 31.

Expert Solution & Answer

Explanation of Solution

a.
1. The current prepaid insurance account balance = $4,700

2. The prepaid insurance account balance as on Dec.31 = $ 900

3. The adjustment entry

Particulars	Debit	Credit
Insurance expense	3,800
To Prepaid Insurance Account		3,800

b.
1. The current prepaid insurance account balance = $5,890
2. The prepaid insurance account balance as on Dec.31 = $ 4,850
3. The adjustment entry

Particulars	Debit	Credit
Insurance expense	1,040
To Prepaid Insurance Account		1,040

$\begin{array}{l} W o r k i n g : \\ \Pr e p a i d I n s u r a n c e a c c o u n t b a l a n c e a s o n D e c .31 = B a l a n c e i n t h e s t a r t - P o l i c i e s \exp i r e d \\ = 5, 890 - 1, 040 \\ = 4, 850 \end{array}$

c.
1. The current prepaid rent account balance = $24,000
2. The prepaid rent account balance as on Dec.31 = $ 20,000
3. The adjustment entry

Particulars	Debit	Credit
Rent expense	4,000
To Prepaid Rent Account		4,000

$\begin{array}{l} W o r k i n g : \\ \Pr e p a i d r e n t a c c o u n t b a l a n c e a s o n D e c .31 = B a l a n c e i n t h e s t a r t - Re n t p e r i o d \exp i r e d \\ = 24, 000 - (24, 000 \times 4 / 24) \\ = 20, 000 \end{array}$

Answer 6

Chapter 3, Problem 5QS

To determine

Concept Introduction:

Prepaid expenses - Prepaid expenses are part of accounting adjustment entries which are recorded in the closing period of the entity. These are those expenses which have not yet incurred but have been paid in advance. These are recorded in the books following the matching principle of accounting.

To determine:

1. The current account balance,

2. The current account balance, and

3. The necessary adjusting entry as on December 31.

Expert Solution & Answer

Explanation of Solution

a.
1. The current prepaid insurance account balance = $4,700

2. The prepaid insurance account balance as on Dec.31 = $ 900

3. The adjustment entry

Particulars	Debit	Credit
Insurance expense	3,800
To Prepaid Insurance Account		3,800

b.
1. The current prepaid insurance account balance = $5,890
2. The prepaid insurance account balance as on Dec.31 = $ 4,850
3. The adjustment entry

Particulars	Debit	Credit
Insurance expense	1,040
To Prepaid Insurance Account		1,040

$\begin{array}{l} W o r k i n g : \\ \Pr e p a i d I n s u r a n c e a c c o u n t b a l a n c e a s o n D e c .31 = B a l a n c e i n t h e s t a r t - P o l i c i e s \exp i r e d \\ = 5, 890 - 1, 040 \\ = 4, 850 \end{array}$

c.
1. The current prepaid rent account balance = $24,000
2. The prepaid rent account balance as on Dec.31 = $ 20,000
3. The adjustment entry

Particulars	Debit	Credit
Rent expense	4,000
To Prepaid Rent Account		4,000

$\begin{array}{l} W o r k i n g : \\ \Pr e p a i d r e n t a c c o u n t b a l a n c e a s o n D e c .31 = B a l a n c e i n t h e s t a r t - Re n t p e r i o d \exp i r e d \\ = 24, 000 - (24, 000 \times 4 / 24) \\ = 20, 000 \end{array}$

Answer 7

Chapter 3, Problem 5QS

To determine

Concept Introduction:

Prepaid expenses - Prepaid expenses are part of accounting adjustment entries which are recorded in the closing period of the entity. These are those expenses which have not yet incurred but have been paid in advance. These are recorded in the books following the matching principle of accounting.

To determine:

1. The current account balance,

2. The current account balance, and

3. The necessary adjusting entry as on December 31.

Answer 8

Expert Solution & Answer

Explanation of Solution

a.
1. The current prepaid insurance account balance = $4,700

2. The prepaid insurance account balance as on Dec.31 = $ 900

3. The adjustment entry

Particulars	Debit	Credit
Insurance expense	3,800
To Prepaid Insurance Account		3,800

b.
1. The current prepaid insurance account balance = $5,890
2. The prepaid insurance account balance as on Dec.31 = $ 4,850
3. The adjustment entry

Particulars	Debit	Credit
Insurance expense	1,040
To Prepaid Insurance Account		1,040

$\begin{array}{l} W o r k i n g : \\ \Pr e p a i d I n s u r a n c e a c c o u n t b a l a n c e a s o n D e c .31 = B a l a n c e i n t h e s t a r t - P o l i c i e s \exp i r e d \\ = 5, 890 - 1, 040 \\ = 4, 850 \end{array}$

c.
1. The current prepaid rent account balance = $24,000
2. The prepaid rent account balance as on Dec.31 = $ 20,000
3. The adjustment entry

Particulars	Debit	Credit
Rent expense	4,000
To Prepaid Rent Account		4,000

$\begin{array}{l} W o r k i n g : \\ \Pr e p a i d r e n t a c c o u n t b a l a n c e a s o n D e c .31 = B a l a n c e i n t h e s t a r t - Re n t p e r i o d \exp i r e d \\ = 24, 000 - (24, 000 \times 4 / 24) \\ = 20, 000 \end{array}$