Nichols Company had the following items that required adjustment at December 31, 2013.Required:1.  Prepare the adjusting entries needed at December 31.  Hide  a.  Electricity used during December was estimated to be $320. This amount will be paid in January.      Dec. 31        (Record accrued utilities)         Hide  b.  Owed wages to employees of $3,250 that were earned in December but unrecorded and unpaid as of the end of the year.      Dec. 31        (Record accrued wages)         Hide  c.  Service revenue of $4,900 was earned in December but unbilled and unpaid as of year end.      Dec. 31        (Record revenue earned but not yet received)         2.  Conceptual Connection: What is the effect on the financial statements if these adjusting entries were not made?Assets will be SelectOverstatedUnderstatedCorrect 1 of Item 4 by $.Liabilities will be SelectOverstatedUnderstatedCorrect 3 of Item 4 by $.

Question
Asked Sep 24, 2019
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Nichols Company had the following items that required adjustment at December 31, 2013.

Required:

1.  Prepare the adjusting entries needed at December 31.

 

  Hide    

a.  Electricity used during December was estimated to be $320. This amount will be paid in January.



 
 
       
Dec. 31
 
 
 
 
 
 
 
 
(Record accrued utilities)
   
       

 

 



  Hide    

b.  Owed wages to employees of $3,250 that were earned in December but unrecorded and unpaid as of the end of the year.



 
 
       
Dec. 31
 
 
 
 
 
 
 
 
(Record accrued wages)
   
       

 

 



  Hide    

c.  Service revenue of $4,900 was earned in December but unbilled and unpaid as of year end.



 
 
       
Dec. 31
 
 
 
 
 
 
 
 
(Record revenue earned but not yet received)
   
       

 

 

 

2.  Conceptual Connection: What is the effect on the financial statements if these adjusting entries were not made?

Assets will be SelectOverstatedUnderstatedCorrect 1 of Item 4 by $.

Liabilities will be SelectOverstatedUnderstatedCorrect 3 of Item 4 by $.

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1. Prepare the adjusting ent...

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Account title and explanation Debit (S) Credit (S) Date a.December 31 Utilities expense 320 Utilities payable |(To record the accrued utilities) 320 b. December 31 Wages expenses 3,250 Wages payable (To record the accrued wages) 3,250 c.December 31Accounts receivable Service revenu |To record the but not yet received) 4,900 4,900 revemue earned

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