Explanation 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. Prepare the adjusting entry: Date Account Title and Explanation Debit ($) Credit ($) December 31 Amortization expense (+E) (-SE) 5,000 Accumulated Amortization (+xA) (-A) 5,000 (To record the adjusting entry for amortization expense) Amortization expense is an expense account which is the component of stockholders’ equity. There is an increase in expense account which decreases the stockholders’ equity. Hence, debit amortization expense with $5,000. Accumulated amortization is the contra-asset account. There is a decrease in the asset. Hence credit, accumulated amortization account with $5,000. T-account: T-account refers to an individual account, where the increases or decreases in the value of specific asset, liability, stockholder’s equity , revenue, and expenditure items are recorded...

6th Edition

ISBN: 9781260664386

Author: PHILLIPS, LIBB

Publisher: MCG

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Chapter 4, Problem 24ME

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To prepare: The journal entry on December 31^st and to post the entries in the separate T-account and report the adjusted trial balance.

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Chapter 4, Problem 23ME

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The journal entry on December 31 st and to post the entries in the separate T-account and report the adjusted trial balance .

Solution Summary: The author explains that adjusting entries are recorded at the end of the accounting period to correct or adjust the revenue and expense accounts.

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To prepare: The journal entry on December 31^st and to post the entries in the separate T-account and report the adjusted trial balance.

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Chapter 4 Solutions

The journal entry on December 31 st and to post the entries in the separate T-account and report the adjusted trial balance .

Solution Summary: The author explains that adjusting entries are recorded at the end of the accounting period to correct or adjust the revenue and expense accounts.

Concept explainers

Videos

To prepare: The journal entry on December 31st and to post the entries in the separate T-account and report the adjusted trial balance.

Want to see the full answer?

Chapter 4 Solutions

To prepare: The journal entry on December 31^st and to post the entries in the separate T-account and report the adjusted trial balance.