Aylmer Inc has a December 31 year end. Aylmer does not perform monthly adjusting entries. The following items relate to transactions that occurred during the 1 On September 1, Aylmer paid $6,000 for an annual insurance premium. The policy began on September 1. The payment was posted to prepaid insurance. 2 On December 31, Aylmer owes the employees $4,000 that will be paid in January. 3 On September 1, Aylmer borrowed $30,000 with an interest rate of 2%. Principle plus interest will be paid back on June 30, 2021. 4 On November 1, Aylmer received $100,000 in advance of performing a specific job. At December 31, 30% of the work has been completed. 5 On October 1, Aylmer purchased a truck for $15,000. The truck has a 5 year useful life with no residual value. 6 At the end of December, the company had not received the monthly utility invoice. It is estimated that the bill would be approximatly $1,000. Prepare the appropriate adjusting or correcting entry for each independent item above

Aylmer Inc has a December 31 year end. Aylmer does not perform monthly adjusting entries. The following items relate to transactions that occurred during the 1 On September 1, Aylmer paid $6,000 for an annual insurance premium. The policy began on September 1. The payment was posted to prepaid insurance. 2 On December 31, Aylmer owes the employees $4,000 that will be paid in January. 3 On September 1, Aylmer borrowed $30,000 with an interest rate of 2%. Principle plus interest will be paid back on June 30, 2021. 4 On November 1, Aylmer received $100,000 in advance of performing a specific job. At December 31, 30% of the work has been completed. 5 On October 1, Aylmer purchased a truck for $15,000. The truck has a 5 year useful life with no residual value. 6 At the end of December, the company had not received the monthly utility invoice. It is estimated that the bill would be approximatly $1,000. Prepare the appropriate adjusting or correcting entry for each independent item above

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter4: The Adjustment Process

Section: Chapter Questions

Problem 8EB: On July 1, a client paid an advance payment (retainer) of $10,000, to cover future legal services....

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On July 1, a client paid an advance payment (retainer) of $5,000 to cover future legal services. During the period, the company completed $3,500 of the agreed-on services for the client. There was no beginning balance in the Unearned Revenue account for the period. Based on the information provided, A. Make the December 31 adjusting journal entry to bring the balances to correct. B. Show the impact that these transactions had.
If the Prepaid Insurance account had a balance of $12,000, representing one years policy premium, which was paid on July 1, what entry would be needed to adjust the Prepaid Insurance account at the end of December, before preparing the financial statements?
Assume that a lawyer bills her clients $15000 on June 30, for services rendered during June. The lawyer collects $8500 of the billings during July and the remainder in August. Under the accrual basis of accounting, when would the lawyer record the revenue for the fees? A. June, $15,000; July, $0; and August, $0 B. June, $0; July, $6,500; and August, $8,500 C. June, $8,500; July, $6,500; and August, $0 D. June, $0; July, $8,500; and August, $6,500
On September 1, a company received an advance rental payment of $12,000, to cover six months rent on an office building. There was no beginning balance in the Unearned Rent account for the period. Based on the information provided, A. Make the December 31 adjusting journal entry to bring the balances to correct. B. Show the impact that these transactions had.
Reviewing insurance policies revealed that a single policy was purchased on March 1, for one years coverage, in the amount of $9,000. There was no previous balance in the Prepaid Insurance account at that time. Based on the information provided, A. Make the December 31 adjusting journal entry to bring the balances to correct. B. Show the impact that these transactions had.
At the end of 2019, Framber Company received 8,000 as a prepayment for renting a building to a tenant during 2020. The company erroneously recorded the transaction by debiting Cash and crediting Rent Revenue in 2019 instead of 2020. Upon discovery of this error in 2020, what correcting journal entry will Framber make? Ignore income taxes.