Adjusting Entries Process
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Prepare written answers to the following assignments
Brief Exercise BE3-3
Prepare adjusting entry for supplies: Gleason Advertising Company's trial balance at December 31 shows Advertising supplies $6700 and Advertising Supplies Expense $0. On December 31, there is $1700 of supplies on hand. Prepare the adjusting entry at December 31, and using T accounts, enter the balances in the accounts, post the adjusting entry, and indicate the adjusted balance in each account.
a. Brief Exercise BE3-4
Prepare adjusting entry for depreciation. At the end of its first year, the trial balance of Easton Company shows equipment $30,000 and zero balances in Accumulated Depreciation - Equipment and Depreciation Expense. Depreciation for the year is estimated to be $6,000. Prepare the adjusting entry for depreciation at Dec. 31, post adjustments to T Accounts, and indicate the balance sheet presentation of the equipment at Dec. 31.
b. Brief Exercise BE3-5
Prepare adjusting entry for prepaid expense. On July 1, 2006, Orlow Co. pays $12,000 to Pizner Insurance Co. for a 3-yr insurance contract. Both companies have fiscal years ending Dec. 31. For Orlow Co., journalize and post the entry on July 1 and the adjusting entry on Dec. 31.
c. Brief Exercise BE3-6
Prepare adjusted entry for unearned revenue. Using the data in BE3-5 above, journalize and post the entry on July 1and the adjusting entry on Dec. 31 for Pizner Insurance Co. Pizner uses the accounts Unearned Insurance Revenue and Insurance Revenue.
d. Brief Exercise BE3-7
Prepare adjusting entries for accruals. The bookkeeper for Wooster Company asks you to prepare the following accrued adjusting entries at December 31.
1) Interest on notes payable of $400 is accrued.
2) Services provided but not recorded total $1250.
3) Salaries earned by employees of $900 have not been recorded.
Use the following account titles: Service Revenue, Accounts Receivable, Interest Expense, Interest Payable, Salaries Expense and Salaries Payable.
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Solution Summary
The solution explains how to journalize adjusting entries
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Please see the attached file
BE3-3
31-Dec Advertising Supplies Expense 5,000 The opening balance was 6,700 and ending balance is 1,700
Advertising Supplies 5,000 so $5,000 of supplies are consumed
Advertising Supplies
6,700 31-Dec 5,000
12/31 Bal. 1,700
Advertising Supplies Expense
31-Dec 5,000 ...
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