FUND ACCOUNTING PRINCIPLES BUNDLE
25th Edition
ISBN: 9781265380311
Author: Wild
Publisher: MCG
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Question
Chapter 3, Problem 3E
To determine
Introduction: The financial statements of a company include the
The expense for each transaction.
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Students have asked these similar questions
Specialty Manufacturing estimated that its total payroll for the coming year would be $482,500. The workers' compensation insurance premium rate is 0.2%.
Required:
1. Calculate the estimated workers' compensation insurance premium.$
Prepare the journal entry for the payment as of January 2, 20--.
If an amount box does not require an entry, leave it blank.
Page:
DATE
ACCOUNT TITLE
DOC.NO.
POST.REF.
DEBIT
CREDIT
1
20-- Jan. 2
1
2
2
3
3
2. Assume that Specialty Manufacturing's actual payroll for the year is $487,000. Calculate the total insurance premium owed.$
Prepare a journal entry as of December 31, 20--, to record the adjustment for the underpayment. The actual payment of the additional premium will take place in January of the next year.
If an amount box does not require an entry, leave it blank.
Page:
DATE
ACCOUNT TITLE
DOC.NO.
POST.REF.
DEBIT
CREDIT
1
20-- Dec. 31
1
2…
Workers' Compensation Insurance and Adjustment
Specialty Manufacturing estimated that its total payroll
for the coming year would be $447,500. The workers'
compensation insurance premium rate is 0.2%.
Required:
1. Calculate the estimated workers' compensation
insurance premium.
$
Prepare the journal entry for the payment as of January
2, 20--.
Page:
DỌC. POST.
DATE
ACCOUNT TITLE
DEBIT
CREDIT
NO.
REF.
20--
1
Jan. 2
1
2
2
3
2. Assume that Specialty Manufacturing's actual payroll
for the year is $452,500.00. Calculate the total
insurance premium owed.
Prepare a journal entry as of December 31, 20--, to
record the adjustment for the underpayment. The actual
payment of the additional premium will take place in
January of the next year.
Page:
DOC. POST.
DATE
ACCOUNT TITLE
DEBIT
CREDIT
NO.
REF.
20--
1
Dec. 31
2
2
3
3
For each of the following separate situations, determine the amount of expense each company should recognize in December (using
accrual basis accounting).
a. Chipotle has monthly wages expense of $5,000 that has been incurred but not paid as of December 31.
b. United Airlines purchases a 24-month insurance policy for $75,000 on December 1 for immediate coverage.
c. On December 15, Pfizer prepays $38,000 for hotel rooms for its January sales meeting.
Expense
recognized in
December
Situations
a. Wages expense incurred but not paid
b. Purchases a 24-month insurance policy
c. Prepays for hotel rooms for its annual sales meeting
Chapter 3 Solutions
FUND ACCOUNTING PRINCIPLES BUNDLE
Ch. 3 - Periodic reporting C1 Choose from the following...Ch. 3 - Prob. 2QSCh. 3 - Identifying accounting adjustments Classify the...Ch. 3 - Concepts 0f adjusting entries During the year, a...Ch. 3 - Prepaid (deferred) expenses adjustments Pl For...Ch. 3 - Prepaid (deferred) expenses adjustments For each...Ch. 3 - Prob. 7QSCh. 3 - Accumulated depreciation adjustments Pl For each...Ch. 3 - Adjusting for depreciation P1 For each separate...Ch. 3 - Unearned (deferred) revenues adjustments For each...
Ch. 3 - Adjusting for unearned (deferred) revenues P2 For...Ch. 3 - Accrued expenses adjustments Pl For each separate...Ch. 3 - Prob. 13QSCh. 3 - Accrued revenues adjustments P4 For each separate...Ch. 3 - Recording and analysing adjusting entries A1...Ch. 3 - QS3-16
Determining effects of adjusting...Ch. 3 - Preparing an adjusted trial balance P5 Following...Ch. 3 - Prob. 18QSCh. 3 - Prob. 19QSCh. 3 - Prob. 20QSCh. 3 - Preparing adjusting entries P4 Garcia Company had...Ch. 3 - Preparing adjusting entries P4 Cal Consulting...Ch. 3 - Prob. 1ECh. 3 - Prob. 2ECh. 3 - Prob. 3ECh. 3 - Prob. 4ECh. 3 - Prob. 5ECh. 3 - Exercise 3-6 Preparing adjusting entries P1 P2 P3...Ch. 3 - Prob. 7ECh. 3 - Prob. 8ECh. 3 - Prob. 9ECh. 3 - Prob. 10ECh. 3 - Prob. 11ECh. 3 - Prob. 12ECh. 3 - Exercise 3-14 Preparing adjusting entries P1 P2 P3...Ch. 3 - Prob. 14ECh. 3 - Prob. 15ECh. 3 - Prob. 16ECh. 3 - Prob. 17ECh. 3 - Prob. 18ECh. 3 - Prob. 19ECh. 3 - Prob. 20ECh. 3 - Problem 3-1A Identifying adjusting entries with...Ch. 3 - Problem 3-2B Preparing adjusting and subsequent...Ch. 3 - Problem 3-3A Preparing adjusting entries, adjusted...Ch. 3 - Problem 3-5A Preparing financial statements from...Ch. 3 - Problem 3-6A
Recording prepaid expenses and...Ch. 3 - Prob. 1PSBCh. 3 - Problem 3-2B Preparing adjusting and subsequent...Ch. 3 - Problem 3-3B Preparing adjusting entries, adjusted...Ch. 3 - Problem 3-5B Preparing financial statements from...Ch. 3 - Problem 3-6B Recording prepaid expenses and...Ch. 3 - Prob. 3SPCh. 3 - Prob. 1GLPCh. 3 - Using transactions from the following assignments,...Ch. 3 - Using transactions from the following assignments,...Ch. 3 - Prob. 4GLPCh. 3 - Prob. 5GLPCh. 3 - Prob. 1AACh. 3 - Key figures for the recent two years of both Apple...Ch. 3 - Key comparative figures for Samsung. Apple, and...Ch. 3 - Prob. 1DQCh. 3 - Why is the accrual basis of accounting generally...Ch. 3 - Prob. 3DQCh. 3 - What is a prepaid expense and where is it reported...Ch. 3 - What type of assets requires adjusting entries to...Ch. 3 - 6. What contra account is used when recording and...Ch. 3 - What is an accrued revenue? Give an example..Ch. 3 - 8. If a company initially records prepaid expenses...Ch. 3 - Prob. 1BTNCh. 3 - Prob. 2BTNCh. 3 - Access EDGAR online (SEC.gov) and locate the...Ch. 3 - Prob. 4BTN
Knowledge Booster
Similar questions
- 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?arrow_forwardThe Accrual Basis of Accounting-Expense? For each of the following separate situations, determine the amount of expense each company should recognize in December (using accrual basis accounting). a. Chipotle has monthly wages expense of $3,200 that has been incurred but not paid as of December 31. b. United Airlines purchases a 24-month insurance policy for $48,000 on December 1 for immediate coverage. c. On December 15, Pfizer prepays $20,000 for hotel rooms for its January sales meeting. Explain your answer. a. b. C. 1arrow_forwardInstructions Mar. Purchased merchandise on account from Kirkwood Co., $372,000, terms n/30. 1 31 Issued a 30-day, 4% note for $372,000 to Kirkwood Co., on account. Apr. 30 Paid Kirkwood Co. the amount owed on the note of March 31. Jun. Borrowed $150,000 from Triple Creek Bank, issuing a 45-day, 8% note. 1 Jul. 1. Purchased tools by issuing a $276,000, 60-day note to Poulin Co., which discounted the note at the rate of 6%. 16 Paid Triple Creek Bank the interest due on the note of June 1 and renewed the loan by issuing a new 30-day, 6.5% note for $150,000. (Journalize both the debit and credit to the notes payable account.) Aug. 15 Paid Triple Creek Bank the amount due on the note of July 16. 30 Paid Poulin Co. the amount due on the note of July 1. Dec. Purchased equipment from Greenwood Co. for $540,000, paying $108,000 cash and issuing a series of ten 4% notes for $43,200 each, coming due at 30-day intervals. 22 Settled a product liability lawsuit with a customer for $309,500, payable…arrow_forward
- Journalize the following transactions into the general journal in accordance with the rules of Journalizing, and the Double-entry accounting system. April 12 Clark Company receives and pays a bill for a two-year insurance policy premium, $3,800. The policy begins on May 1. Clark Company purchases equipment costing $5,600, paying 40% down and the rest on account. November 27arrow_forwardWorkers' Compensation Insurance and Adjustment Specialty Manufacturing estimated that its total payroll for the coming year would be $447,500. The workers' compensation insurance premium rate is 0.2%. Required: 1. Calculate the estimated workers' compensation insurance premium.$ Prepare the journal entry for the payment as of January 2, 20--. Page: DATE ACCOUNT TITLE DOC. NO. POST. REF. DEBIT CREDIT 1 20--Jan. 2 1 2 2 3 3 2. Assume that Specialty Manufacturing's actual payroll for the year is $452,500.00. Calculate the total insurance premium owed.$ Prepare a journal entry as of December 31, 20--, to record the adjustment for the underpayment. The actual payment of the additional premium will take place in January of the next year. Page: DATE ACCOUNT TITLE DOC. NO. POST. REF. DEBIT CREDIT 1 20--Dec. 31 1 2 2 3 3arrow_forwardFor each of the following separate situations, determine the amount of expense each company should recognize in Decembe (using accrual basis accounting) a. Chipotle has monthly wages expense of $6,000 that has been incurred but not paid as of December 31 b. United Airlines purchases a 24-month insurance policy for $90,000 on December 1 for immediate coverage. oarrow_forward
- Noura Company offers an annual bonus to employees (to be shared equally) if the company meets certain net income goals. Prepare the journal entry to record a $14,000 bonus owed (but not yet paid) to its workers at calendar year-end. View transaction list Journal entry worksheet < 1 Record the expected bonus costs. Note: Enter debits before credits. Date December 31 General Journal Debit Credit 7 Record entry Clear entry View general journalarrow_forwardSensible Insurance Company collected a premium of $18,000 for a 1-year insurance policy on April 1. What amount should Sensible report as a current liability for Unearned Service Revenue at December 312 Select one: a. $4,500. b. $18,000. C. $0. d. $13,500.arrow_forwardNoura Company offers an annual bonus to employees (to be shared equally) if the company meets certain net income goals. Prepare the journal entry to record a $14,000 bonus owed (but not yet paid) to its workers at calendar year-end. View transaction list Journal entry worksheet < 1 Record the expected bonus costs. Note: Enter debits before credits. Date December 31 General Journal Debit Credit Clear entry View general journal Record entryarrow_forward
- United Airlines purchases a 24-month insurance policy for $48,000 on December 1 for immediate coverage. Expense recognized in December?arrow_forwardOn November 19, Nicholson Company receives a $24,000, 60-day, 6% note from a customer as payment on account. What adjusting entry should be made on the December 31 year-end? (Use 360 days a year.) Multiple Choice Debit Interest Revenue $240; credit Interest Receivable $240. Debit Notes Receivable $168; credit Interest Receivable $168. Debit Notes Receivable $72; credit Interest Revenue $72. Debit Interest Receivable $168; credit Interest Revenue $168. Debit Interest Receivable $240; credit Interest Revenue $240.arrow_forwardOn November 19, Nicholson Company receives a $15,000, 60-day, 8% note from a customer as payment on account. What adjusting entry should be made on the December 31 year-end? use 360 days a yeararrow_forward
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