Use the following information about Miller Corporation to answer the next four questions. Miller Corporation paid $1,800 and purchased a two-year insurance on September 1, 2020. The policy period starts September 1, 2020 and runs until August 31, 2022. Miller Corporation's fiscal year ends December 31. The company records adjusting entries only at year end.

Use the following information about Miller Corporation to answer the next four questions. Miller Corporation paid $1,800 and purchased a two-year insurance on September 1, 2020. The policy period starts September 1, 2020 and runs until August 31, 2022. Miller Corporation's fiscal year ends December 31. The company records adjusting entries only at year end.

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 5RE: Garcia Company rents out a portion of its building to Jerry Company for 1,000 per month. On August...

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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?
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.
Garcia Company rents out a portion of its building to Jerry Company for 1,000 per month. On August 1, Jerry paid Garcia 12,000 for 1 year of rent in advance. Prepare journal entries for Garcia to record the collection ofrent and the related year-end adjusting entry on December 31.
The following selected accounts and their current balances appear in the ledger of Clairemont Co. for the fiscal year ended May 31, 2019: Instructions 1. Prepare a multiple-step income statement. 2. Prepare a statement of owners equity. 3. Prepare a balance sheet, assuming that the current portion of the note payable is 50,000. 4. Briefly explain how multiple-step and single-step income statements differ.
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.
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.
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Renfro Company purchased a 12-month insurance policy on March 1, 2022 for $1,800. At March 31, 2022, the adjusting journal entry to record expiration of this asset will include a a debit to Prepaid Insurance and a credit to Insurance Expense for $200. b debit to Insurance Expense and a credit to Cash for $150. c debit to Insurance Expense and a credit to Prepaid Insurance for $150. d debit to Prepaid Insurance and a credit to Cash for $1,800.
During the course of your examination of the financial statements of the Hales Corporation for the year ended December 31, 2021, you discover the following:a. An insurance policy covering three years was purchased on January 1, 2021, for $6,000. The entire amount was debited to insurance expense and no adjusting entry was recorded for this item.b. During 2021, the company received a $1,000 cash advance from a customer for merchandise to be manufactured and shipped in 2022. The $1,000 was credited to sales revenue. No entry was recorded for the cost of merchandise.c. There were no supplies listed in the balance sheet under assets. However, you discover that supplies costing $750 were on hand at December 31.d. Hales borrowed $20,000 from a local bank on October 1, 2021. Principal and interest at 12% will be paid on September 30, 2022. No accrual was recorded for interest.e. Net income reported in the 2021 income statement is $30,000 before reflecting any of the above…
On March 1, 2020, Jimenez purchased a one-year insurance policy for $2,400. On that date, Jimenez debited Prepaid Insurance for $2,400. If Jimenez prepares financial statements at the end of March, the adjusting journal entry would include a: credit to Insurance Expense for $2,200. credit to Prepaid Insurance for $200. None of these. debit to Insurance Expense for $2,400. debit to Insurance Expense for $2,200.