Depreciation on the company’s equipment for the year is computed to be $18,000.The Prepaid Insurance account had a $6,000 debit balance at December 31 before adjusting for the costs of any expired coverage. An analysis of the company’s insurance policies showed that $1,100 of unexpired insurance coverage remains.The Office Supplies account had a $700 debit balance at the beginning of the year; and $3,480 of office supplies were purchased during the year. The December 31 physical count showed $300 of supplies available.Two-thirds of the work related to $15,000 of cash received in advance was performed this period.The Prepaid Rent account had a $6,800 debit balance at December 31 before adjusting for the costs of expired prepaid rent. An analysis of the rental agreement showed that $5,800 of prepaid rent had expired.Wage expenses of $3,200 have been incurred but are not paid as of December 31. Prepare adjusting journal entries for the year ended (date of) December 31 for each of these separate situations.

Journal is the book of original entry in which all the transactions of the business are recorded…

Answered: Depreciation on the company’s equipment…

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter3: Review Of A Company's Accounting System

Section: Chapter Questions

Problem 1P: Adjusting Entries The following information is available for Drake Company, which adjusts and closes...

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Depreciation on the company’s equipment for the year is computed to be $18,000.
The Prepaid Insurance account had a $6,000 debit balance at December 31 before adjusting for the costs of any expired coverage. An analysis of the company’s insurance policies showed that $1,100 of unexpired insurance coverage remains.
The Office Supplies account had a $700 debit balance at the beginning of the year; and $3,480 of office supplies were purchased during the year. The December 31 physical count showed $300 of supplies available.
Two-thirds of the work related to $15,000 of cash received in advance was performed this period.
The Prepaid Rent account had a $6,800 debit balance at December 31 before adjusting for the costs of expired prepaid rent. An analysis of the rental agreement showed that $5,800 of prepaid rent had expired.
Wage expenses of $3,200 have been incurred but are not paid as of December 31.

Prepare adjusting journal entries for the year ended (date of) December 31 for each of these separate situations.

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