ADJUSTMENTS a.-b. Merchandise inventory on December 31, 20X1, is $13,321 c. During 20X1, the firm had net credit sales of $45,000; the firm estimates that 0.5 percent of these sales will result in uncollectible accounts. d. On December 31, 20X1, an inventory of the supplies showed that items costing $325 were on hand. e. On October 1, 20X1, the firm signed a six-month advertising contract for $1,080 with a local newspaper and paid the full amount in advance. f. On January 2, 20X0, the firm purchased store equipment for $8,700. At that time, the equipment was estimated to have a useful life of five years and a salvage value of $700. g. On January 2, 20X0, the firm purchased office equipment for $2,200. At that time, the equipment was estimated to have a useful life of five years and a salvage value of $300. h. On December 31, 20X1, the firm owed salaries of $1,930 that will not be paid until 20X2 i. On December 31, 20X1, the firm owed the employer's social security tax (assume 6.2 percent) and Medicare tax (assume 1.45 percent) on the entire $1,930 of accrued wages. j. On December 31, 20X1, the firm owed federal unemployment tax (assume 0.6 percent) and state unemployment tax (assume 5.4 percent) on the entire $1,930 of accrued wages. Required: 1. Prepare the Trial Balance section of a 10-column worksheet. The worksheet covers the year ended December 31, 20X1. 2. Enter the adjustments above in the Adjustments section of the worksheet 3. Complete the worksheet Analyze: By what amount were the assets of the business affected by adjustments? > Answer is not complete. Complete this question by entering your answers in the tabs below. Worksheet Analyze By what amount were the assets of the business affected by adjustments? Total assets decreased by $15,925 X
ADJUSTMENTS a.-b. Merchandise inventory on December 31, 20X1, is $13,321 c. During 20X1, the firm had net credit sales of $45,000; the firm estimates that 0.5 percent of these sales will result in uncollectible accounts. d. On December 31, 20X1, an inventory of the supplies showed that items costing $325 were on hand. e. On October 1, 20X1, the firm signed a six-month advertising contract for $1,080 with a local newspaper and paid the full amount in advance. f. On January 2, 20X0, the firm purchased store equipment for $8,700. At that time, the equipment was estimated to have a useful life of five years and a salvage value of $700. g. On January 2, 20X0, the firm purchased office equipment for $2,200. At that time, the equipment was estimated to have a useful life of five years and a salvage value of $300. h. On December 31, 20X1, the firm owed salaries of $1,930 that will not be paid until 20X2 i. On December 31, 20X1, the firm owed the employer's social security tax (assume 6.2 percent) and Medicare tax (assume 1.45 percent) on the entire $1,930 of accrued wages. j. On December 31, 20X1, the firm owed federal unemployment tax (assume 0.6 percent) and state unemployment tax (assume 5.4 percent) on the entire $1,930 of accrued wages. Required: 1. Prepare the Trial Balance section of a 10-column worksheet. The worksheet covers the year ended December 31, 20X1. 2. Enter the adjustments above in the Adjustments section of the worksheet 3. Complete the worksheet Analyze: By what amount were the assets of the business affected by adjustments? > Answer is not complete. Complete this question by entering your answers in the tabs below. Worksheet Analyze By what amount were the assets of the business affected by adjustments? Total assets decreased by $15,925 X
College Accounting, Chapters 1-27 (New in Accounting from Heintz and Parry)
22nd Edition
ISBN:9781305666160
Author:James A. Heintz, Robert W. Parry
Publisher:James A. Heintz, Robert W. Parry
Chapter14: Adjustments And The Work Sheet For A Merchandising Business
Section: Chapter Questions
Problem 1SEA: ADJUSTMENT FOR MERCHANDISE INVENTORY USING T ACCOUNTS: PERIODIC INVENTORY SYSTEM Matt Henry owns a...
Related questions
Question
Transcribed Image Text:ADJUSTMENTS
a.-b. Merchandise inventory on December 31, 20X1, is $13,321
c. During 20X1, the firm had net credit sales of $45,000; the firm estimates that 0.5 percent of these sales will result in uncollectible
accounts.
d. On December 31, 20X1, an inventory of the supplies showed that items costing $325 were on hand.
e. On October 1, 20X1, the firm signed a six-month advertising contract for $1,080 with a local newspaper and paid the full amount in
advance.
f. On January 2, 20X0, the firm purchased store equipment for $8,700. At that time, the equipment was estimated to have a useful
life of five years and a salvage value of $700.
g. On January 2, 20X0, the firm purchased office equipment for $2,200. At that time, the equipment was estimated to have a useful
life of five years and a salvage value of $300.
h. On December 31, 20X1, the firm owed salaries of $1,930 that will not be paid until 20X2
i. On December 31, 20X1, the firm owed the employer's social security tax (assume 6.2 percent) and Medicare tax (assume 1.45
percent) on the entire $1,930 of accrued wages.
j. On December 31, 20X1, the firm owed federal unemployment tax (assume 0.6 percent) and state unemployment tax (assume 5.4
percent) on the entire $1,930 of accrued wages.
Required:
1. Prepare the Trial Balance section of a 10-column worksheet. The worksheet covers the year ended December 31, 20X1.
2. Enter the adjustments above in the Adjustments section of the worksheet
3. Complete the worksheet
Analyze:
By what amount were the assets of the business affected by adjustments?
> Answer is not complete.
Complete this question by entering your answers in the tabs below.
Worksheet
Analyze
By what amount were the assets of the business affected by adjustments?
Total assets
decreased
by
$15,925 X
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