Adjusting entries
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1. Prepare the adjusting entry that would be made on December 31, 2009, the end of the year for the following: (Be sure and indicate what accounts you are debiting and crediting in your answer).
The supplies asset on January 1, 2008 was $9,100. Supplies costing $18,150 were acquired during the year and charged to the supplies expense. A count on December 31, 2008 indicated the supplies on hand of $16,810. Be sure and indicate what accounts you are debiting and crediting in your answer.
2. Prepare the adjusting entry that would be made on December 31, 2009, the end of the year for the following: (Be sure and indicate what accounts you are debiting and crediting in your answer).
On April 30, 2009, a ten month 9% note for $10,000 was received from a customer.
3.
Prepare the adjusting entry that would be made on December 31, 2009, the end of the year for the following: (Be sure and indicate what accounts you are debiting and crediting in your answer).
Partial trial balance debit credit
Inventory, January 1, 2009 50,000
Purchases 75,000
Purchase returns 12,000
Note: the company uses the periodic inventory method and took a physical count at year end: inventory, December 31, 2009 $88,000
4. (Be sure and indicate what accounts you are debiting and crediting in your answer).
In its first year of operations Best Corp. had sales revenue of $230,000, cost of goods sold $125,000, operating expenses $20,000 and gain on the sale of equipment of $4,000. What is the adjusting entry for income tax expense, assuming an income tax rate of 20%?
5. Prepare the adjusting entry that would be made on December 31, 2009, the end of the year for the following: (Be sure and indicate what accounts you are debiting and crediting in your answer).
Cash received from customers of $35,000 on December 1, 2009 was for services to be performed. The entry was credited to service revenue. At December 31, 2009, one-fourth of of the services were performed.
6. What would be the necessary adjusting entry to supplies expense at December 31, 2008, for the Bolton Company for following situation? Assume that no financial statements were prepared during the year and no adjusting entries were recorded:
In July, the company purchased supplies for $4,000. The entry was recorded as a debit to supplies asset. Supplies on hand at the end of the year totaled $2,200. No supplies had been previously purchased
7.
Davis Hardware Company uses a perpetual inventory system. How should Davis record the sale of merchandise costing $560 for $1040 on account?
Be sure and label each entry with a DR for debit and CR for credit
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Solution Summary
The solution explains the adjusting entries to be made for the given transactions
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1. Prepare the adjusting entry that would be made on December 31, 2009, the end of the year for the following: (Be sure and indicate what accounts you are debiting and crediting in your answer).
The supplies asset on January 1, 2008 was $9,100. Supplies costing $18,150 were acquired during the year and charged to the supplies expense. A count on December 31, 2008 indicated the supplies on hand of $16,810. Be sure and indicate what accounts you are debiting and crediting in your answer.
Beginning balance is 9,100
Supplies purchased are 18,150
Supplies at the end are 16,810.
Supplies consumed us 9,100+18,150-16,810=10,440
When the supplies were purchased, they were charged to expense so the supplies expense is now 18,150.
The actual expense is 10,400. We need to reduce the supplies expense by 7,710. The adjusting entry is
Supplies Dr 7,710
Supplies Expense Cr 7,710
With this the balance in supplies account is 9,100+7,710=16,810 and supplies expense is 10,440.
2. Prepare the adjusting entry that would be made on December 31, 2009, the end of the year for the following: (Be sure and indicate what accounts you are debiting and crediting in your answer).
On April 30, 2009, a ten ...
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