On December 31, the adjusted trial balance of Shihata Employment Agency shows the following selected data. Accounts
Question:
Accounts Receivable .......... $24,500
Interest Expense ........... 7,700
Service Revenue ........... $92,500
Interest Payable ............ 2,200
Analysis shows that adjusting entries were made to
(1) Accrue $5,000 of service revenue
(2) Accrue $2,200 interest expense.
Instructions
(a) Prepare the closing entries for the temporary accounts shown above at December 31.
(b) Prepare the reversing entries on January 1.
(c) Post the entries in (a) and (b). Underline and balance the accounts. (Use T-accounts.)
(d) Prepare the entries to record
(1) The collection of the accrued revenue on January 10
(2) The payment of all interest due ($3,000) on January 15.
(e) Post the entries in (d) to the temporary accounts.
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Related Book For
Accounting Principles
ISBN: 978-1118875056
12th edition
Authors: Jerry Weygandt, Paul Kimmel, Donald Kieso
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