Generally Accepted Accounting Principles and Trial Balance Essay

1517 Words Dec 31st, 2013 7 Pages
Problem set C
PROBLEM 3-1C
For each of the following entries, enter the letter of the explanation that most closely describes it in the space beside each entry. (You can use letters 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. I. To record this period’s depreciation expense.

______ 1. Interest Expense 600 Interest Payable 600
______ 2. Interest Payable 600
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The tenant has agreed to not fall behind again.

f. On December 1, the company rented space to another tenant for $3,200 per month. The tenant paid six months' rent in advance on that date. The payment was recorded with a credit to the Unearned Rent account.

Required 1. Use the information to prepare adjusting entries as of December 31, 2008. 2. Prepare journal entries to record the first subsequent cash transactions in 2009 for parts c and e.

PROBLEM 3-3C

Champlain Confuser Systems, a tech center owned by Sam Champlain, provides training to individuals who pay tuition directly to the school. The school also offers training to groups in off-site locations. Its unadjusted trial balance as of December 31, 2008, follows. Champlain Confuser Systems initially records prepaid expenses and unearned revenues in balance sheet accounts. Descriptions of items a through h that require adjusting entries on December 31, 2008, follow.

Additional Items a. An analysis of the company’s insurance policies shows that $3,600 of coverage has expired. b. An inventory count shows that teaching supplies costing $900 are available at year-end 2008. c. Annual depreciation on the equipment is $7,200. d. Annual depreciation on the professional library is $1,500. e. On October 1, the company agreed to do a special five-month course for a
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