On December 31, the end of the year, the accountant for Fireside Magazine was called away suddenly because of an emergency. However, before leaving, the accountant jotted down a few notes pertaining to the adjustments. Journalize the necessary adjusting entries. Assume that Fireside Magazine uses the periodic inventory system. a–b. A physical count of inventory revealed a balance of $199,830. The Merchandise Inventory account shows a balance of $202,839. c. Subscriptions received in advance amounting to $156,200 were recorded as Unearned Subscriptions. At year-end, $103,120 has been earned. d. Depreciation of equipment for the year is $12,300. e. The amount of expired insurance for the year is $1,612. f. The balance of Prepaid Rent is $2,400, representing four months’ rent. Three months’ rent has expired. g. Three days’ salaries will be unpaid at the end of the year; total weekly (five days’) salaries are $4,000. h. As of December 31, the balance of the supplies account is $1,800. A physical inventory of the supplies was taken, with an amount of $920 determined to be on hand.

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College Accounting (Book Only): A ...

12th Edition
Cathy J. Scott
Publisher: Cengage Learning
ISBN: 9781305084087
BuyFind

College Accounting (Book Only): A ...

12th Edition
Cathy J. Scott
Publisher: Cengage Learning
ISBN: 9781305084087

Solutions

Chapter 11, Problem 6E
Textbook Problem

On December 31, the end of the year, the accountant for Fireside Magazine was called away suddenly because of an emergency. However, before leaving, the accountant jotted down a few notes pertaining to the adjustments. Journalize the necessary adjusting entries. Assume that Fireside Magazine uses the periodic inventory system.

a–b. A physical count of inventory revealed a balance of $199,830. The Merchandise Inventory account shows a balance of $202,839.

c. Subscriptions received in advance amounting to $156,200 were recorded as Unearned Subscriptions. At year-end, $103,120 has been earned.

d. Depreciation of equipment for the year is $12,300.

e. The amount of expired insurance for the year is $1,612.

f. The balance of Prepaid Rent is $2,400, representing four months’ rent. Three months’ rent has expired.

g. Three days’ salaries will be unpaid at the end of the year; total weekly (five days’) salaries are $4,000.

h. As of December 31, the balance of the supplies account is $1,800. A physical inventory of the supplies was taken, with an amount of $920 determined to be on hand.

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Chapter 11 Solutions

College Accounting (Book Only): A Career Approach
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