24th Edition

ISBN: 9781266494604

Author: Wild

Publisher: MCG

Concept explainers

The Effect Of Prepaid Taxes On Assets And Liabilities

Many businesses estimate tax liability and make payments throughout the year (often quarterly). When a company overestimates its tax liability, this results in the business paying a prepaid tax. Prepaid taxes will be reversed within one year but can resu…

Final Accounts

Financial accounting is one of the branches of accounting in which the transactions arising in the business over a particular period are recorded.

Ledger Posting

A ledger is an account that provides information on all the transactions that have taken place during a particular period. It is also known as General Ledger. For example, your bank account statement is a general ledger that gives information about the a…

Trial Balance and Final Accounts

In accounting we start with recording transaction with journal entries then we make separate ledger account for each type of transaction. It is very necessary to check and verify that the transaction transferred to ledgers from the journal are accurately…

Adjustment Entries

At the end of every accounting period Adjustment Entries are made in order to adjust the accounts precisely replicate the expenses and revenue of the current period. It is also known as end of period adjustment. It can also be referred as financial repor…

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Textbook Question

Chapter 3, Problem 7E

Exercise 3-7 Preparing adjusting entries P1 P3 P4

For each of the following separate cases, prepare adjusting entries required of financial statements for the year ended (date of) December 31. Entries can draw from the following partial chart of accounts: Cash: Interest Receivable; Supplies; Prepaid Insurance; Equipment; Accumulated Depreciation— Equipment: Wages Payable: Interest Payable: Unearned Revenue: Interest Revenue: Wages Expense: Supplies Expense: Insurance Expense: Interest Expense; and Depreciation Expense—Equipment.
a. Wages of $8,000 are earned by workers but not paid as of December 31.
b. Depreciation on the company's equipment for the year is $18,000.
C. The Supplies account had a $240 debit balance at the beginning of the year. During the year. $5.200 of supplies are purchased. A physical count of supplies at December 31 shows $440 of supplies available. Check (of) Dr. Insurance Expense. $2,8CD
d. The Prepaid Insurance account had a $4,000 balance at the beginning of the year. An analysis of insurance policies shows that $1 ,200 of unexpired insurance benefits remain at December 31.
e. The company has earned (but not recorded) $1,050 of interest revenue for the year ended December 31. The interest payment will be received 10 days after the year-end on January 10.
(e) Cr. Interest Revenue, $1,050
f. The company has a bank loan and has incurred (but not recorded) interest expense of $ 2,500 for the year ended December 31. The company will pay the interest five days after the year-end on January 5.

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Chapter 3, Problem 6E

Chapter 3, Problem 8E

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Prepare journal entries to record the December transactions in the General Journal Tab in the excel template file Use the following accounts as appropriate: Cash. Land. Notes Payable. Depreciation Expense. Accounts Receivable. Accumulated Depreciation. Common Stock. Salaries Expense. Supplies. Accounts Payable. Retained Earnings. Supplies Expense. Prepaid Insurance. Deferred Revenue. Dividends. Rent Expense. Equipment. Salaries Payable. Service Revenue. Insurance Expense 1-Dec: Issue common stock in exchange for cash of $6,000. 1-Dec: Paid the premium in advance on a one-year insurance policy, $480. 1-Dec: Purchased Equipment for $3,600 cash. 5-Dec: Purchased office supplies from XYZ Company on account, $400. 15-Dec: Provided services to customers for $5,400 cash. 16-Dec: Provided services to customer ABC Inc. on account, $2,500. 17-Dec: Received $800 cash in advance from a customer for services to be provided in January. 22-Dec: Paid $220 to XYZ company for the Dec 5 purchase on…

For journal entries 1through 12, indicate the explanation that most closely describes it. You can use explanations more than once. A. To record receipt of unearned revenue. B. To record this period's earning of prior unearned revenue. C. To record payment of an accrued expense. D. To record receipt of an accrued revenue. E. To record an accrued expense. F. To record an accrued revenue. G. To record this period's use of a prepaid expense. H. To record payment of a prepaid expense. 1. To record this period's depreciation expense.

Posting Adjusting Entries Two adjusting entries are in the following general journal. Post these adjusting entries to the four general ledger accounts. DATE 20-- Dec. 31 31 GENERAL JOURNAL DESCRIPTION Supplies Expense Supplies Wages Expense Wages Payable POST. REF. III DEBIT 85.00 220.00 PAGE 9 CREDIT 85.00 220.00 7

Chapter 3 Solutions

FUNDAMENTAL ACCT PRIN CONNECT ACCESS

Ch. 3 - Prob. 1DQ Ch. 3 - Why is the accrual basis of accounting generally...Ch. 3 - Prob. 3DQ Ch. 3 - What is a prepaid expense and where is it reported...Ch. 3 - What type of assets requires adjusting entries to...Ch. 3 - 6. What contra account is used when recording and...Ch. 3 - What is an accrued revenue? Give an example..Ch. 3 - 8. If a company initially records prepaid expenses...Ch. 3 - Review the balance sheet of Apple in Appendix À....Ch. 3 - Prob. 10DQ

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