Concept explainers
1.
Record the adjusted
1.
Explanation of Solution
Trial Balance: Trial balance is the summary of all the accounts affected in a financial year. Financial statements are prepared with the help of trial balance.
The adjusted trial balance section of the worksheet of UBS is as follows:
Account Title |
Unadjusted Trial balance | Adjustments |
Adjusted Trial balance | |||
Dr. ($) | Cr. ($) | Dr. ($) | Cr. ($) | Dr. ($) | Cr. ($) | |
Cash | 23,075 | |||||
Accounts receivable | 3,812 | |||||
Supplies | 4,600 | |||||
Prepaid rent | 21,000 | |||||
Equipment | 27,500 | |||||
950 | ||||||
Accounts payable | 9,000 | |||||
RD, capital | 41,837 | |||||
RD, drawing | 4,000 | |||||
Fees income | 48,550 | |||||
Depreciation expense–equipment | 950 | |||||
Rent expense | 3500 | |||||
Salaries expense | 8500 | |||||
Supplies expense | 2,900 | |||||
Utilities expense | 500 | |||||
Total | $100,337 | $100,337 |
Table (1)
2.
Prepare the
2.
Explanation of Solution
The adjustments section of the worksheet of UBS is as follows:
Account Title |
Unadjusted Trial balance | Adjustments |
Adjusted Trial balance | |||
Dr. ($) | Cr. ($) | Dr. ($) | Cr. ($) | Dr. ($) | Cr. ($) | |
Cash | 23,075 | |||||
Accounts receivable | 3,812 | |||||
Supplies | 2,900 | 4,600 | ||||
Prepaid rent | 3,500 | 21,000 | ||||
Equipment | 27,500 | |||||
Accumulated | 950 | 950 | ||||
Accounts payable | 9,000 | |||||
RD, capital | 41,837 | |||||
RD, drawing | 4,000 | |||||
Fees income | 48,550 | |||||
Depreciation expense–equipment | 950 | 950 | ||||
Rent expense | 3,500 | 3500 | ||||
Salaries expense | 8500 | |||||
Supplies expense | 2,900 | 2,900 | ||||
Utilities expense | 500 | |||||
Total | 7,350 | 7,350 | 100,337 | 100,337 |
Table (2)
3.
Complete the trial balance columns of the worksheet and find out the balance of prepaid rent prior to the adjustment made.
3.
Explanation of Solution
The complete trial balance columns of the worksheet of UBS are as follows:
Account Title |
Unadjusted Trial balance | Adjustments |
Adjusted Trial balance | |||
Dr. ($) | Cr. ($) | Dr. ($) | Cr. ($) | Dr. ($) | Cr. ($) | |
Cash | 23,075 | 23,075 | ||||
Accounts receivable | 3,812 | 3,812 | ||||
Supplies | 7,500 | 2,900 | 4,600 | |||
Prepaid rent | 24,500 | 3,500 | 21,000 | |||
Equipment | 27,500 | 27,500 | ||||
Accumulated depreciation-equipment | 950 | 950 | ||||
Accounts payable | 9,000 | 9,000 | ||||
RD, capital | 41,837 | 41,837 | ||||
RD, drawing | 4,000 | 4,000 | ||||
Fees income | 48,550 | 48,550 | ||||
Depreciation expense–equipment | 950 | 950 | ||||
Rent expense | 3,500 | 3500 | ||||
Salaries expense | 8,500 | 8500 | ||||
Supplies expense | 2,900 | 2,900 | ||||
Utilities expense | 500 | 500 | ||||
Total | 99,387 | 99,387 | 7,350 | 7,350 | 100,337 | 100,337 |
Table (3)
The balance of prepaid rent prior to the adjusting entry of expired rent was $24,500.
Working Note:
Calculate balance of prepaid rent prior to the adjusting entry of expired rent:
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Chapter 5 Solutions
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