Chapter 5, Problem 13SEA

CASH, MODIFIED CASH, AND ACCRUAL BASES OF ACCOUNTING Prepare the entry for each of the following transactions, using the (a) cash basis, (b) modified cash basis, and (c) accrual basis of accounting.

1. 1. Purchase supplies on account.
2. 2. Make payment on asset previously purchased.
3. 3. Purchase supplies for cash.
4. 4. Purchase insurance for cash.
5. 5. Pay cash for wages.
6. 6. Pay cash for phone expense.
7. 7. Pay cash for new equipment.

End-of-Period Adjusting Entries:

1. 8. Wages earned but not paid.
2. 9. Prepaid item purchased, partly used.
3. 10. Depreciation on long-term assets.