BT Spa had the following transactions during the year. Its year-end is on June 30. a. The

Question:

BT Spa had the following transactions during the year. Its year-end is on June 30.
a. The Unearned Revenue account showed a balance of $800, which represented four gift certificates of $200 each sold in June. Three gift certificates had been redeemed in June.
b. The Prepaid Rent account showed a balance of $6,000, which represented six months’ rent paid on April 1.
c. An exercise machine was purchased on March 1 for $7,500. BT estimated that the machine could last 8 years, with a of $300 at the end of the 8th year.
d. Five employees each earned $100/day. Salary for the last seven days of June would be paid on July 2nd.
e. A fitness service was performed for a business client on June 30 for $350.
The invoice was sent on July 5th, after the year-end date.
Requirements
1. Identify each of the above transactions as accrued revenue, accrued expense, deferred revenue, or deferred expense.
2. Record the adjusting entry for each transaction.
Salvage Value
Salvage value is the estimated book value of an asset after depreciation is complete, based on what a company expects to receive in exchange for the asset at the end of its useful life. As such, an asset’s estimated salvage value is an important...