Annie Brown owns a construction designing firm called Achi Design. The unadjusted trial balance on 30 June 2019 below was prepared by her accountant. Achi Design Unadjusted Trial Balance As at 30 June 2019 Account Cash at bank Accounts receivable Allowance for doubtful debts Prepaid advertising Office supplies Office equipment Accumulated depreciation - office equipment Accounts payable Unearned fees A, Brown, Capital Design fees revenue Rent expense Salaries & wages expenses Telephone expense Debit ($) 144,150 276,450 31,800 26,250 279,300 198,600 1,012,500 31,800 2,000,850 Credit ($) 3,750 34,200 175,050 38,700 239,850 1,509,300 2,000,850 The following additional information is available at 30 June. Unused supplies on hand on 30 June totalled $2,700 The Unearned Fees account includes $12,350 received for fees earned during June. Estimated annual depreciation on the office equipment is 10% of the cost of the asset. Advertising costing $20,200 was consumed during the year Based on ageing analysis, 4% of the total accounts receivable are estimated as doubtful debts. Required Prepare the adjusting entries at the end of the accounting period. Ignore

Annie Brown owns a construction designing firm called Achi Design. The unadjusted trial balance on 30 June 2019 below was prepared by her accountant. Achi Design Unadjusted Trial Balance As at 30 June 2019 Account Cash at bank Accounts receivable Allowance for doubtful debts Prepaid advertising Office supplies Office equipment Accumulated depreciation - office equipment Accounts payable Unearned fees A, Brown, Capital Design fees revenue Rent expense Salaries & wages expenses Telephone expense Debit ($) 144,150 276,450 31,800 26,250 279,300 198,600 1,012,500 31,800 2,000,850 Credit ($) 3,750 34,200 175,050 38,700 239,850 1,509,300 2,000,850 The following additional information is available at 30 June. Unused supplies on hand on 30 June totalled $2,700 The Unearned Fees account includes $12,350 received for fees earned during June. Estimated annual depreciation on the office equipment is 10% of the cost of the asset. Advertising costing $20,200 was consumed during the year Based on ageing analysis, 4% of the total accounts receivable are estimated as doubtful debts. Required Prepare the adjusting entries at the end of the accounting period. Ignore

Financial Accounting

15th Edition

ISBN:9781337272124

Author:Carl Warren, James M. Reeve, Jonathan Duchac

Publisher:Carl Warren, James M. Reeve, Jonathan Duchac

Chapter4: Completing The Accounting Cycle

Section: Chapter Questions

Problem 4PB: The unadjusted trial balance of Recessive Interiors at January 31, 2019, the end of the year,...

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Valley Realty acts as an agent in buying, selling, renting, and managing real estate. The unadjusted trial balance on July 31, 2019, follows: The following business transactions were completed by Valley Realty during August 2019: Aug. 1. Purchased office supplies on account, 3,150. 2.Paid rent on office for month, 7,200. 3.Received cash from clients on account, 83,900. 5.Paid insurance premiums, 12,000. 9.Returned a portion of the office supplies purchased on August 1, receiving full credit for their cost, 400. Analyzing Transactions Aug. 17. Paid advertising expense, 8,000. 23.Paid creditors on account, 13,750. Enter the following transactions on Page 19 of the two-column journal: 29.Paid miscellaneous expenses, 1,700. 30.Paid automobile expense (including rental charges for an automobile), 2,500. 31.Discovered an error in computing a commission during July; received cash from the salesperson for the overpayment, 2,000. 31.Paid salaries and commissions for the month, 53,000. 31.Recorded revenue earned and billed to clients during the month, 183,500. 31.Purchased land for a future building site for 75,000, paying 7,500 in cash and giving a note payable for the remainder. 31.Withdrew cash for personal use, 1,000. 31.Rented land purchased on August 31 to a local university for use as a parking lot during football season (September, October, and November); received advance payment of 5,000. Instructions 1. Record the August 1 balance of each account in the appropriate balance column of a four-column account, write Balance in the item section, and place a check mark () in the Posting Reference column. 2. Journalize the transactions for August in a two-column journal beginning on Page 18. Journal entry explanations may be omitted. 3. Post to the ledger, extending the account balance to the appropriate balance column after each posting. 4. Prepare an unadjusted trial balance of the ledger as of August 31, 2019. 5. Assume that the August 31 transaction for Cindy Getmans cash withdrawal should have been 10,000. (a) Why did the unadjusted trial balance in (4) balance? (b) Journalize the correcting entry. (c) Is this error a transposition or slide?
Worksheet Victoria Company has the following account balances on December 31, 2019, prior to any adjustments: Additional adjustment information: (a) depreciation on buildings, 1,100; on equipment, 600; (b) bad debts expense, 240; (c) interest accumulated but not paid: on note payable, 50; on mortgage payable, 530 (this interest is due during the next accounting period); (d) insurance expired, 175; (e) salaries accrued but not paid 370; (f) rent was collected in advance and the performance obligation is now satisfied, 800; (g) office supplies cm hand at year-end, 230 (expensed when originally purchased earlier in the year); and (h) the income tax rate is 30% on current income and is payable in the first quarter of 2020. Required: 1. Transfer the account balances to a 10-column worksheet and prepare a trial balance. 2. Prepare the adjusting entries in the general journal and complete the worksheet. 3. Prepare the companys income statement, retained earnings statement, and balance sheet. 4. Prepare closing entries in the general journal.
The unadjusted trial balance of Recessive Interiors at January 31, 2019, the end of the year, follows: The data needed to determine year-end adjustments are as follows: a. Supplies on hand at January 31 are 2,850. b. Insurance premiums expired during the year are 3,150. c. Depreciation of equipment during the year is 5,250. d. Depreciation of trucks during the year is 4,000. e. Wages accrued but not paid at January 31 are 900. Instructions 1. For each account listed in the unadjusted trial balance, enter the balance in the appropriate Balance column of a four-column account and place a check mark () in the Posting Reference column. 2. (Optional) Enter the unadjusted trial balance on an end-of-period spreadsheet and complete the spreadsheet. Add the accounts listed in part (3) as needed. 3. Journalize and post the adjusting entries, inserting balances in the accounts affected. Record the adjusting entries on Page 26 of the journal. The following additional accounts from Recessive Interiors chart of accounts should be used: Wages Payable, 22; Depreciation ExpenseEquipment, 54; Supplies Expense, 55; Depreciation ExpenseTrucks, 56; Insurance Expense, 57. 4. Prepare an adjusted trial balance. 5. Prepare an income statement, a statement of owners equity (no additional investments were made during the year), and a balance sheet. 6. Journalize and post the closing entries. Record the closing entries on Page 27 of the journal. Indicate closed accounts by inserting a line in both Balance columns opposite the closing entry. 7. Prepare a post-closing trial balance.
We-Sell Realty, organized August 1, 2019, is owned and operated by Omar Farah. How many errors can you find in the following statements for We-Sell Realty, prepared after its first month of operations?
Elite Realty acts as an agent in buying, selling, renting, and managing real estate. The unadjusted trial balance on March 31, 2019, follows: The following business transactions were completed by Elite Realty during April 2019: Apr. 1. Paid rent on office for month, 6,500. 2.Purchased office supplies on account, 2,300. 5.Paid insurance premiums, 6,000. 10.Received cash from clients on account, 52,300. 15.Purchased land for a future building site for 200,000, paying 30,000 in cash and giving a note payable for the remainder. 17.Paid creditors on account, 6,450. 20.Returned a portion of the office supplies purchased on April 2, receiving full credit for their cost, 325. 23.Paid advertising expense, 4,300. Enter the following transactions on Page 19 of the two-column journal: 27.Discovered an error in computing a commission; received cash from the salesperson for the overpayment, 2,500. 28.Paid automobile expense (including rental charges for an automobile), 1,500. 29.Paid miscellaneous expenses, 1,400. 30.Recorded revenue earned and billed to clients during the month, 57,000. 30.Paid salaries and commissions for the month, 11,900. 30.Withdrew cash for personal use, 4,000. 30.Rented land purchased on April 15 to local merchants association for use as a parking lot in May and June, during a street rebuilding program; received advance payment of 10,000. Instructions 1. Record the April 1, 2019, balance of each account in the appropriate balance column of a four-column account, write Balance in the item section, and place a check mark () in the Posting Reference column. 2. Journalize the transactions for April in a two-column journal beginning on Page 18. Journal entry explanations may be omitted. 3. Post to the ledger, extending the account balance to the appropriate balance column after each posting. 4. Prepare an unadjusted trial balance of the ledger as of April 30, 2019. 5. Assume that the April 30 transaction for salaries and commissions should have been 19,100. (a) Why did the unadjusted trial balance in (4) balance? (b) Journalize the correcting entry. (c) Is this error a transposition or slide?
Reece Financial Services Co., which specializes in appliance repair services, is owned and operated by Joni Reece. Reece Financial Services accounting clerk prepared the following unadjusted trial balance at July 31, 2019: The data needed to determine year-end adjustments are as follows: Depreciation of building for the year, 6,400. Depreciation of equipment for the year, 2,800. Accrued salaries and wages at July 31, 900. Unexpired insurance at July 31, 1,500. Fees earned but unbilled on July 31, 10,200. Supplies on hand at July 31, 615. Rent unearned at July 31, 300. Instructions 1. Journalize the adjusting entries using the following additional accounts: Salaries and Wages Payable, Rent Revenue, Insurance Expense, Depreciation ExpenseBuilding, Depreciation ExpenseEquipment, and Supplies Expense. 2. Determine the balances of the accounts affected by the adjusting entries and prepare an adjusted trial balance.
In December 2019, Swanstrom Inc. receives a cash payment of $3,500 for services performed in December 2019 and a cash payment of S4,500 for services to be performed in January 2020. Swanstrom also receives the December utility bill for S600 but does not pay this bill until 2020. For 2019, under the accrual basis of accounting, Swanstrom would recognize: a. $8,000 of revenue and $600 of expense. b. $8,000 of revenue and $0 of expense. c. $3,500 of revenue and $600 of expense. d. $3,500 Of revenue and $0 of expense.
Kling Company was organized in late 2019 and began operations on January 2, 2020. Prior to the start of operations, it incurred the following costs: Required: 1. What amount should the company expense in 2019? In 2020? 2. Next Level What is the justification of the accounting treatment of these costs?
Pitman Company is a small editorial services company owned and operated by Jan Pitman. On October 31, 2019 the end of the current year, Pitman Company’s accounting clerk prepared the following unadjusted trial balance:Pitman CompanyUNADJUSTED TRIAL BALANCEOctober 31, 2019ACCOUNT TITLE DEBIT CREDIT1Cash7,710.002Accounts Receivable37,935.003Prepaid Insurance7,070.004Supplies2,125.005Land108,400.006Building145,300.007Accumulated Depreciation-Building85,610.008Equipment134,800.009Accumulated Depreciation-Equipment96,100.0010Accounts Payable12,625.0011Unearned Rent6,340.0012Jan Pitman, Capital219,690.0013Jan Pitman, Drawing15,120.0014Fees Earned323,700.0015Salaries and Wages Expense196,770.0016Utilities Expense42,265.0017Advertising Expense23,135.0018Repairs Expense17,195.0019Miscellaneous Expense6,240.0020Totals744,065.00744,065.00The data needed to determine year-end adjustments are as follows:a. Unexpired insurance at October 31, $6,105.b. Supplies on hand at October 31, $485.c.…
Annie Brown owns a construction designing firm called Achi Design. The unadjusted trial balance on 30 June 2019 below was prepared by her accountant. Achi Design Unadjusted Trial Balance As at 30 June 2019 Account Debit ($) Credit ($) Cash at bank 144,150 Accounts receivable 276,450 Allowance for doubtful debts 3,750 Prepaid advertising 31,800 Office supplies 26,250 Office equipment 279,300 Accumulated depreciation - office equipment 34,200 Accounts payable 175,050 Unearned fees 38,700 A, Brown, Capital 239,850 Design fees revenue 1,509,300 Rent expense 198,600 Salaries & wages expenses 1,012,500 Telephone expense 31,800 2,000,850 2,000,850 The following additional information is available at 30 June. Unused supplies on hand on 30 June totalled $2,700 The Unearned Fees account includes $12,350 received for fees earned during June.…
The Beep-Beep Alarm Company provides security services in Bloomington, IL. At the year end 2019, afteradjusting entries have been made, the following list of account balances is prepared.Service Revenue $ 612,900Salaries Expense $ 148,250Rent Expense $ 27,600Utilities Expense $ 48,800Supplies Expense $ 51,900Income Tax Expense $ 30,800Retained Earnings $ 305,550Dividends $ 6,0001. Prepare the closing journal entry to close the revenue account on December 31st. Date Account Debit Credit2. Prepare the closing journal entry to close the expense account on December 31st. Date Account Debit Credit3. Income Summary is an account used to indicate consideration of all revenues and expenses as one value for a closing entry.Prepare the closing journal entry on December 31st to close Income Summary if the company used this as a single account ratherthan individually closing revenues and expenses. Hint: this means the company did not individually complete #1 and #2 but theoutcome should be the…
Big Blue Rental Corp. provides rental agent services to apartment building owners. Big Blue Rental Corp.’s preliminary income statement for August 2019 and its August 31, 2019, preliminary balance sheet did not reflect the following: Rental commissions of $670 had been earned in August but had not yet been received from or billed to building owners. When supplies are purchased, their cost is recorded as an asset. As supplies are used, a record of those used is kept. The record sheet shows that $530 of supplies were used in August. Interest on the note payable is to be paid on May 31 and November 30. Interest for August has not been accrued—that is, it has not yet been recorded. (The Interest Payable of $90 on the balance sheet is the amount of the accrued liability at July 31.) The interest rate on this note is 10%. Wages of $430 for the last week of August have not been recorded. The Rent Expense of $1,530 represents rent for August, September, and October, which was paid early in…