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Adjusting entries Selected account balances before adjustment for Intuit Realty at November 30, the end of the current year, follow: Debits Credits Accounts Receivable $75,000 Equipment 250,000 Accumulated Depreciation- Equipment $12,000 Prepaid Rent 12,000 Supplies 3,170 Wages Payable — Unearned Fees 10,000 Fees Earned 400,000 Wages Expense 140,000 Rent Expense — Depreciation Expense — Supplies Expense — Data needed for year-end adjustments are as follows: Supplies on hand at November 30, $550. Depreciation of equipment during year, $1,675. Rent expired during year, $8,500. wages accrued but not paid at November 30, $2,000. Unearned fees a t November 30, $4,000. Unbilled fees at November 30, $5,380. Instructions 1. Journalize the six adjusting entries required at November 30, based on the data presented. 2. What would be the effect on the income statement if the adjustments for equipment depreciation and unearned fees were omitted at the end of the year? 3. What would be the effect on the balance sheet if the adjustments for equipment depreciation and unearned fees were omitted at the end of the year? 4. What would be the effect on the "Net increase or decrease in cash" on the statement of cash flows if the adjustments for equipment depreciation and unearned fees were omitted at the end of the year?

BuyFind

Accounting (Text Only)

26th Edition
Carl Warren + 2 others
Publisher: Cengage Learning
ISBN: 9781285743615
BuyFind

Accounting (Text Only)

26th Edition
Carl Warren + 2 others
Publisher: Cengage Learning
ISBN: 9781285743615

Solutions

Chapter
Section
Chapter 3, Problem 3.2BPR
Textbook Problem

Adjusting entries

Selected account balances before adjustment for Intuit Realty at November 30, the end of the current year, follow:

  Debits Credits
Accounts Receivable $75,000  
Equipment 250,000  
Accumulated Depreciation- Equipment   $12,000
Prepaid Rent 12,000  
Supplies 3,170  
Wages Payable  
Unearned Fees   10,000
Fees Earned   400,000
Wages Expense 140,000  
Rent Expense  
Depreciation Expense  
Supplies Expense  

Data needed for year-end adjustments are as follows:

  • Supplies on hand at November 30, $550.
  • Depreciation of equipment during year, $1,675.
  • Rent expired during year, $8,500.
  • wages accrued but not paid at November 30, $2,000.
  • Unearned fees a t November 30, $4,000.
  • Unbilled fees at November 30, $5,380.

Instructions

  1. 1. Journalize the six adjusting entries required at November 30, based on the data presented.
  2. 2. What would be the effect on the income statement if the adjustments for equipment depreciation and unearned fees were omitted at the end of the year?
  3. 3. What would be the effect on the balance sheet if the adjustments for equipment depreciation and unearned fees were omitted at the end of the year?
  4. 4. What would be the effect on the "Net increase or decrease in cash" on the statement of cash flows if the adjustments for equipment depreciation and unearned fees were omitted at the end of the year?

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Chapter 3 Solutions

Accounting (Text Only)
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Ch. 3 - Accounts requiring adjustment Indicate with a Yes...Ch. 3 - Accounts requiring adjustment Indicate with a Yes...Ch. 3 - Type of adjustment Classify the following items as...Ch. 3 - Type of adjustment Classify the following items as...Ch. 3 - Adjustment for prepaid expense The supplies...Ch. 3 - Adjustment for prepaid expense The prepaid...Ch. 3 - Adjustment for unearned revenue The balance in the...Ch. 3 - Adjustment for unearned revenue On June 1, 2016,...Ch. 3 - Adjustment for accrued revenues At the end of the...Ch. 3 - Adjustment for unearned revenue The balance in the...Ch. 3 - Adjustment for prepaid expense The prepaid...Ch. 3 - Adjustment for prepaid expense The supplies...Ch. 3 - Adjustment for depreciation The estimated amount...Ch. 3 - Adjustment for depreciation The estimated amount...Ch. 3 - Effect of omitting adjustments For the year ending...Ch. 3 - Effect of omitting adjustments For the year ending...Ch. 3 - Effect of errors on adjusted trial balance For...Ch. 3 - Effect of errors on adjusted trial balance For...Ch. 3 - Vertical analysis Two income statements for...Ch. 3 - Vertical analysis Two income statements for Cornea...Ch. 3 - Classifying types of adjustments Classify the...Ch. 3 - Classifying adjusting entries The following...Ch. 3 - Adjusting entry for supplies The balance in the...Ch. 3 - Determining supplies purchased The supplies and...Ch. 3 - Effect of omitting adjusting entry At March 31,...Ch. 3 - Adjusting entries for prepaid insurance The...Ch. 3 - Adjusting entries for prepaid insurance The...Ch. 3 - Adjusting entries for unearned fees The balance in...Ch. 3 - Effect of omitting adjusting entry At the end of...Ch. 3 - Adjusting entry for accrued fees At the end of the...Ch. 3 - Adjusting entries for unearned and accrued fees...Ch. 3 - Effect of omitting adjusting entry The adjusting...Ch. 3 - Adjusting entries for accrued salaries Ocular...Ch. 3 - Determining wages paid The wages payable and wages...Ch. 3 - Effect of omitting adjusting entry Accrued...Ch. 3 - Effect of omitting adjusting entry Assume that the...Ch. 3 - Adjusting entries for prepaid and accrued taxes...Ch. 3 - Adjustment for depreciation The estimated amount...Ch. 3 - Determining fixed assets book value The balance in...Ch. 3 - Book value of fixed assets In a recent balance...Ch. 3 - Effects of errors on financial statements For a...Ch. 3 - Effects of errors on financial statements For a...Ch. 3 - Effects of errors on financial statements The...Ch. 3 - Effects of errors on financial statements If the...Ch. 3 - Adjusting entries for depreciation; effect of...Ch. 3 - Adjusting entries from trial balances The...Ch. 3 - Adjusting entries from trial balances The...Ch. 3 - Vertical analysis of income statement The...Ch. 3 - Vertical analysis of income statement The...Ch. 3 - Adjusting entries On March 31, 2016, the following...Ch. 3 - Adjusting entries Selected account balances before...Ch. 3 - Adjusting entries Reliable Repairs Service, an...Ch. 3 - Adjusting entries Good Note Company specializes in...Ch. 3 - Adjusting entries and adjusted trial balances...Ch. 3 - Adjusting entries and errors At the end of April,...Ch. 3 - Adjusting entries On May 31, 2016, the following...Ch. 3 - Adjusting entries Selected account balances before...Ch. 3 - Adjusting entries Crazy Mountain Outfitters Co.,...Ch. 3 - Adjusting entries The Signage Company specializes...Ch. 3 - Adjusting entries and adjusted trial balances...Ch. 3 - Adjusting entries and errors At the end of August,...Ch. 3 - The unadjusted trial balance that you prepared for...Ch. 3 - Ethics and professional conduct in business Daryl...Ch. 3 - Accrued revenue The following is an excerpt from a...Ch. 3 - Adjustments and financial statements Several years...

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