1. On 4/15/17 Mountain Services Company secured a bridging loan of $15,000 from its Bankers and issued a 90 days note payable at 6% interest. The fiscal year end on 6/30/17. How much interest is due and charged as interest expense? Show the journal adjustment necessary to update the accounts.

2. For each of the following errors, indicate on the table below the amount by which the trial balance will be out of balance and which trial balance column (debit or credit) will have the larger total as a result of the error.

a. $100 debit to Cash was debited to the Cash account twice

b. $1,900 credit to Sales was posted as a $190 credit

c. $5,000 debit to Office Equipment was debited to Office Supplies

d. $625 debit to Prepaid Insurance was posted as a $652 debit

e. $520 credit to Accounts Payable was not posted, though the debit was correctly posted.

3. A company started the year with a $320 debit balance in the supplies account. During the fiscal year, it purchased supplies of $2,780 up to the date of the compilation of the unadjusted trial balance. At the end of the fiscal period, the count of inventory used is $2,650. What adjusting journal should be prepared to update the accounts?

4. The following trial balance was prepared from the general ledger of Hal's Auto Repair.

Since the trial balance did not balance, you decided to examine the accounting records. You found that the following errors had been made:

1. A purchase of supplies on account for $245 was posted as a debit to Supplies and as a debit to Accounts Payable.

2. An investment of $500 cash by the owner was debited to Common Stock and credited to Cash.

3. In computing the balance of the Accounts Receivable account, a debit of $600 was omitted from the computation.

4. One debit of $300 to the Dividends account was posted as a credit.

5. Office equipment purchased for $800 was posted to the Repair Equipment account.

6. One entire entry was not posted to the general ledger. The transaction involved the receipt of $125 cash at the time repair services were performed.

Required: Prepare the corrected trial balance for the Hal's Auto Repair as of October 31.

HAL'S AUTO REPAIR

Trial Balance

October 31

Dr.

Cr.

Cash

Accounts receivable

Supplies

Repair equipment

Office equipment

Accounts payable

Common stock

Retained earnings

Dividends paid

Repair fees earned

Supply expense

TOTALS

5. A company with a fiscal accounting date of 6/30/-, purchased a piece of machinery for $45,000 on 4/01/2017. It is estimated that the machinery will be used for 8 years and at the end use, a residual value of $3,000. What adjustment journal entries will be required on 6/30/2017 and 6/30/2018.

6. On December14, 2016 Bench Company received $9,500 cash for consulting services that will be performed by end January 2017. Bench Company records all such prepayments in a liability account when received. Prepare a general journal entry to record the necessary adjustment to the accounts if $6,000 worth of services have been completed and delivered.

7. On Friday 3/26/2017 a company pays each of its two office employees at the rate of $550 per week each for a five-day week that begins on Monday. If the accounting period ends on Wednesday 3/31/2017and the employees worked to the end of the month, the adjusting entry to update the salaries expense at the period end will be what?

8. A company, on examination of its trial balance, discovered the following errors, even though the trial balance balanced.

a. Rent expense account is recorded $500 less on debit side while salary payable account is overcast by $500 on the credit side.

b. An amount of $327 to be debited to travelling expense is written as $237 and an amount of $546 credit to sales revenue is written as $456.

Prepare a journal with the correcting entries to update the ledger accounts.