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College Accounting, Chapters 1-27

23rd Edition
HEINTZ + 1 other
ISBN: 9781337794756

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BuyFindarrow_forward

College Accounting, Chapters 1-27

23rd Edition
HEINTZ + 1 other
ISBN: 9781337794756
Textbook Problem

POSTING ADJUSTING ENTRIES Two adjusting entries are shown in the following general journal. Post these adjusting entries to the four general ledger accounts. The following account numbers were taken from the chart of accounts: 145, Prepaid Insurance; 183.1, Accumulated Depreciation—Cleaning Equipment; 541, Depreciation Expense—Cleaning Equipment; and 535, Insurance Expense. If you are not using the working papers that accompany this text, enter the following balances before posting the entries: Prepaid Insurance, $960 Debit; Accumulated Depreciation—Cleaning Equipment, $870 Credit.

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To determine

Post these adjusting entries to the four general ledger accounts.

Explanation

General ledger:

General ledger is a record of all accounts of assets, liabilities, and stockholders’ equity, necessary to prepare financial statements.

Adjusting entries:

Adjusting entries are those entries which are recorded at the end of the year, to update the income statement accounts (revenue and expenses) and balance sheet accounts (assets, liabilities, and stockholders’ equity) to maintain the records according to accrual basis principle.

Post these adjusting entries to the four general ledger accounts.

                                    Prepaid insurance                                    Account No: 145
DateItemPost. Ref.DebitCreditBalance
DebitCredit
July1Balance    960 
 31Adjusting  320640 

(Table 1)

          Accumulated Depreciation-Cleaning  equipment         Account No: 183.1
DateItemPost. Ref...

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