Chapter 4, Problem 6CP

a.1.

To determine

Identify the number of accounting periods where this transaction directly affects the financial statements of Company CL.

a.2.

To determine

Indicate the amount of depreciation expense reported on the income statements of 2019 and 2020.

a.3.

To determine

Explain the way in which office equipment would be reported on the 2021 balance sheet.

a.4.

To determine

Explain whether Company CL has to make an adjusting entry at the end of each year during the life of the equipment.

b.1.

To determine

Identify the number of accounting periods where this transaction directly affects the financial statements of Company CL.

b.2.

To determine

Indicate the amount of rent revenue that is reported by Company CL in its 2021 income statements.

b.3.

To determine

Explain whether the given transaction creates a liability for Company CL as of the end of 2021, and by how much.

b.4.

To determine

Prepare the adjusting entry on December 31, 2022.

c.1.

To determine

Identify the number of accounting periods where this transaction directly affects the financial statements of Company CL.

c.2.

To determine

Explain the way in which unrecorded wages of $7,500 affects the income statement and balance sheet of Company CL.

c.3.

To determine

Prepare the adjusting entry on December 31, 2021.

d.1.

To determine

Explain whether service revenue should be recorded on this job for 2021.

d.2.

To determine

Prepare the adjusting entry on December 31, 2021.

d.3.

To determine

Prepare the entry for Company CL on February 15, 2022.