Parrish Ch. 4 Pg. 101 4-5 11/25/19For the following entries please identify if the entry is correct.  If not correct the entry and explay WHY it is incorrect.  Thank you. 1) To record depreciation on trucks for one year.  The trucks cost $30000 and have no salvage value.  They are being depreciated strait line over 6 years.Depreciation Expense       $1500           Accumulated Depreciation       $15002) To record one year's interest on a loan to an officer of the compnay.  The loan was $10000 at 7% interest Interest Revenue     $730              Interest Receivable    $7303) The Supplies account started with a balance of $1900. At the end of the period, a count of remaining supplies was indicated we had $563 left.Supplies Expense      $563        Supplies                         $5634) Employees have earned $1900 since last paydayWages Expense   $1900        Wages Payable          $19005) The company received a bill from the County Treasurer for $700 property taxes.  The taxes are due next month6) To record sales made on the last day of the year which company which the company has not yet billedSales       $2800      Accounts Receivable    $28007) To record one month of rent expense. Three months ago, the company paid $8160 for one years rentRent Expense       $680        Prepaid Rent        $6808) The company received an electric bill for $800 for the current month.  The bill is due  next month.Utilities Expense    $800      Utilities Payable $8009) The supplies account had a balance of $2300 at the end of the month.  The count at the end of the month showed a balance of $400Supplies      $1900          Supplies Expense $190010) The company performed $1000 of services which the client pay for in advance.Undearned service fees     $1000            Service fee revenue       $1000

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Asked Nov 25, 2019
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Parrish Ch. 4 Pg. 101 4-5 11/25/19

For the following entries please identify if the entry is correct.  If not correct the entry and explay WHY it is incorrect.  Thank you. 

1) To record depreciation on trucks for one year.  The trucks cost $30000 and have no salvage value.  They are being depreciated strait line over 6 years.

Depreciation Expense       $1500

           Accumulated Depreciation       $1500

2) To record one year's interest on a loan to an officer of the compnay.  The loan was $10000 at 7% interest

 Interest Revenue     $730

              Interest Receivable    $730

3) The Supplies account started with a balance of $1900. At the end of the period, a count of remaining supplies was indicated we had $563 left.

Supplies Expense      $563

        Supplies                         $563

4) Employees have earned $1900 since last payday

Wages Expense   $1900

        Wages Payable          $1900

5) The company received a bill from the County Treasurer for $700 property taxes.  The taxes are due next month

6) To record sales made on the last day of the year which company which the company has not yet billed

Sales       $2800

      Accounts Receivable    $2800

7) To record one month of rent expense. Three months ago, the company paid $8160 for one years rent

Rent Expense       $680

        Prepaid Rent        $680

8) The company received an electric bill for $800 for the current month.  The bill is due  next month.

Utilities Expense    $800

      Utilities Payable $800

9) The supplies account had a balance of $2300 at the end of the month.  The count at the end of the month showed a balance of $400

Supplies      $1900

          Supplies Expense $1900

10) The company performed $1000 of services which the client pay for in advance.

Undearned service fees     $1000

            Service fee revenue       $1000

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Expert Answer

Step 1

Journal Entry:

Journal entry is the act of keeping or making record of any transactions. Transactions are listed in an accounting journal that shows a company’s debit and credit balance. The journal entry can consist of several recordings each of which is either a debit or a credit.

Step 2

Following are the reason of in...

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Credit Amount S. No. Particulars Debit Amount Entry is incorrect Depreciation Expense Account Debit To Accumulated Depreciation Account Note: Depreciation as per straight line method (Cost-Salvage Value)/Useful life of asset Therefore, Depreciation-($30,000-06 Years 1 $5,000 $5,000 Entry is incorrect 2. Interest Receivable Account Debit $700 To Interest Revenue Account Note: Interest is on $10,000 for 1 year at 7 % per annum, Therefore Interest ($10,000 x 7% p.ax1 year) $700 Entry is incorrect Supplies Expense Account debit (1900 beginning $563) To supplies Account Note: $563 is "Ending Balance of supplies 3. $1,337 $1,337 Entry is correct: 4. Entry is incorrect: Tax Expense Account Debit To Tax Payable Account Note: Tax is due in next month, on accrual basis we recorded an expense in current month and created a liability 5. $700 $700

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