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Concept explainers
1.
Record adjusted
1.
![Check Mark](/static/check-mark.png)
Explanation of Solution
Trial Balance:
Trial balance is the summary of all the accounts affected in a financial year. Financial statements are prepared with the help of trial balance.
The adjusted trial balance column of the worksheet of KN:
Account Title |
Unadjusted Trial balance | Adjustments |
Adjusted Trial balance | |||
Dr. ($) | Cr. ($) | Dr. ($) | Cr. ($) | Dr. ($) | Cr. ($) | |
Cash | 70,100 | |||||
17,000 | ||||||
Supplies | 13,600 | |||||
Prepaid rent | 81,600 | |||||
Equipment | 132,000 | |||||
1,100 | ||||||
Accounts payable | 34,000 | |||||
KN, capital | 160,000 | |||||
KN, drawing | 12,000 | |||||
Fees income | 171,400 | |||||
Depreciation expense–equipment | 1,100 | |||||
Rent expense | 6,800 | |||||
Salaries expense | 21,600 | |||||
Supplies expense | 7,200 | |||||
Utilities expense | 3,500 | |||||
Total | 366,500 | 366,500 |
Table (1)
2.
Prepare adjustments entries in the adjustment column of the worksheet
2.
![Check Mark](/static/check-mark.png)
Explanation of Solution
The adjustment column of the worksheet of KN:
Account Title |
Unadjusted Trial balance | Adjustments |
Adjusted Trial balance | |||
Dr. ($) | Cr. ($) | Dr. ($) | Cr. ($) | Dr. ($) | Cr. ($) | |
Cash | 70,100 | |||||
Accounts receivable | 17,000 | |||||
Supplies | 7,200 | 13,600 | ||||
Prepaid rent | 6,800 | 81,600 | ||||
Equipment | 132,000 | |||||
Accumulated | 1,100 | 1,100 | ||||
Accounts payable | 34,000 | |||||
KN, capital | 160,000 | |||||
KN, drawing | 12,000 | |||||
Fees income | 171,400 | |||||
Depreciation expense–equipment | 1,100 | 1,100 | ||||
Rent expense | 6,800 | 6,800 | ||||
Salaries expense | 21,600 | |||||
Supplies expense | 7,200 | 7,200 | ||||
Utilities expense | 3,500 | |||||
Total | 15,100 | 15,100 | 366,500 | 366,500 |
Table (2)
3.
Complete the trial balance columns of the worksheet and find the contra asset account on the adjusted trial balance.
3.
![Check Mark](/static/check-mark.png)
Explanation of Solution
The complete trial balance columns of the worksheet of KN:
Account Title |
Unadjusted Trial balance | Adjustments |
Adjusted Trial balance | |||
Dr. ($) | Cr. ($) | Dr. ($) | Cr. ($) | Dr. ($) | Cr. ($) | |
Cash | 70,100 | 70,100 | ||||
Accounts receivable | 17,000 | 17,000 | ||||
Supplies | 20,800 | 7,200 | 13,600 | |||
Prepaid rent | 88,400 | 6,800 | 81,600 | |||
Equipment | 132,000 | 132,000 | ||||
Accumulated depreciation-equipment | 1,100 | 1,100 | ||||
Accounts payable | 34,000 | 34,000 | ||||
KN, capital | 160,000 | 160,000 | ||||
KN, drawing | 12,000 | 12,000 | ||||
Fees income | 171,400 | 171,400 | ||||
Depreciation expense–equipment | 1,100 | 1,100 | ||||
Rent expense | 6,800 | 6,800 | ||||
Salaries expense | 21,600 | 21,600 | ||||
Supplies expense | 7,200 | 7,200 | ||||
Utilities expense | 3,500 | 3,500 | ||||
Totals | 365,400 | 365,400 | 15,100 | 15,100 | 366,500 | 366,500 |
Table (3)
Accumulated depreciation-equipment is the contra account on the adjusted trial balance.
Working Note: Calculate balance of prepaid rent prior to the
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Chapter 5 Solutions
COLLEGE ACCOUNTING (LL)W/ACCESS>CUSTOM<
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