Concept explainers
Journalizing and posting adjustments to the T-accounts and preparing an adjusted
The unadjusted trial balance of Aurora Air Purification System at December 31, 2016, and the data needed for the adjustments follow.
Adjustment data at December 31 follow:
a. On December 15, Aurora contracted to perform services for a client receiving $2,800 in advance. Aurora recorded this receipt of cash as Unearned Revenue. As of December 31, Aurora has completed $ 1,800 of the services.
b. Aurora prepaid two months of rent on December 1.
c. Aurora used $600 of office supplies.
d.
e. Aurora received a bill for December’s online advertising, $1,000. Aurora will not pay the bill until January. (Use Accounts Payable.)
f. Aurora pays its employees on Monday for the previous week’s wages. Its employees earn $1,500 for a five-day workweek. December 31 falls on Wednesday this year.
g. On October 1, Aurora agreed to provide a four-month air system check (beginning October 1) for a customer for $3,000. Aurora has completed the system check every month, but payment has not yet been received and no entries have been made.
Requirements
1. Journalize the
2. Using the unadjusted trial balance, open the T-accounts with the unadjusted balances.
3. Prepare the adjusted trial balance.
4. How will Aurora Air Purification System use the adjusted trial balance?
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Horngren's Financial & Managerial Accounting, Student Value Edition (5th Edition)
- The trial balance of Wikki Cleaners at December 31, 2012, the end of the current fiscal year, is as follows: Information for the adjusting entries is as follows: a. Cleaning supplies on hand on December 31, 2012, 18,750. b. Insurance premiums expired during the year, 1,800. c. Depreciation on equipment during the year, 21,600. d. Wages accrued but not paid at December 31, 2012, 1,830. Suppose you discover that an assistant in your department had misunderstood your instructions and had provided you with the wrong information on two of the adjusting entries. Cleaning supplies consumed during the year should have been 18,750, and insurance premiums unexpired at year-end were 1,800. Make the corrections on your worksheet and save the corrected file as F1WORK4. Reprint the worksheet.arrow_forwardThe unadjusted trial balance of La Mesa Laundry at August 31, 2016, the end of the fiscal year, follows: The data needed to determine year-end adjustments are as follows: a. Wages accrued but not paid at August 31 are 2,200. b. Depreciation of equipment during the year is 8,150. c. Laundry supplies on hand at August 31 are 2,000. d. Insurance premiums expired during the year are 5,300. Instructions 1. For each account listed in the unadjusted trial balance, enter the balance in a T account. Identify the balance as Aug. 31 Bal. In addition, add T accounts for Wages Payable, Depreciation Expense, Laundry Supplies Expense, Insurance Expense, and Income Summary. 2. (Optional) Enter the unadjusted trial balance on an end-of-period spreadsheet and complete the spreadsheet. Add the accounts listed in part (1) as needed. 3. Journalize and post the adjusting entries. Identify the adjustments by Adj. and the new balances as Adj. Bal. 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. Identify the closing entries by Clos. 7. Prepare a post-closing trial balance.arrow_forwardThe unadjusted trial balance that you prepared for PS Music at the end of Chapter 2 should appear as follows: The data needed to determine adjustments are as follows: a. During July, PS Music provided guest disc jockeys for KXMD for a total of 115 hours. For information on the amount of the accrued revenue to be billed to KXMD, see the contract described in the July 3, 2016, transaction at the end of Chapter 2. b. Supplies on hand at July 31, 275. c. The balance of the prepaid insurance account relates to the July 1, 2016, transaction at the end of Chapter 2. d. Depreciation of the office equipment is 50. e. The balance of the unearned revenue account relates to the contract between PS Music and KXMD, described in the July 3, 2016, transaction at the end of Chapter 2. f. Accrued wages as of July 31, 2016, were 140. Instructions 1. Prepare adjusting journal entries. You will need the following additional accounts: 18 Accumulated DepreciationOffice Equipment 22 Wages Payable 57 Insurance Expense 58 Depreciation Expense 2.Post the adjusting entries, inserting balances in the accounts affected. 3.Prepare an adjusted trial balance.arrow_forward
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