1 Problem 3-2A Preparing adjusting and subsequent journal entries LO C1, A1, P1 Arnez Company's annual accounting period ends on December 31, 2017. The following information concerns the adjusting entries to 10 a. The Office Supplies account started the year with a $3,425 balance. During 2017, the company purchased supplies for $14,545, which was added to the Office Supplies account. The inventory of supplies available at December 31, 2017, totaled $3,01 b. An analysis of the company's insurance policies provided the following facts. Policy Months of Coverage 24 36 12 Date of Purchase April 1, 2015 April 1, 2016 August 1, 2017 Cost $10,824 The total premium for each policy was paid in full for all months) at the purchase date, and the Prepaid Insurance account was debited for the full cost. (Year-end adjusting entries for Prepaid Insurance were properly recorded in all prior years c. The company has 15 employees, who eam a total of $2.50 in salaries each working day. They are paid each Monday for their work in the five-day workweek ending on the previous Friday. Assume that December 31, 2017 is a Tuesday, and all 15 employees worked the first two days of that week. Because New Year's Day is a paid holday, they wil be paid salaries for five full days on Monday, January 6, 2018 d. The company purchased a building on January 1, 2017. it cost $795,000 and is expected to have a $45.000 salvage value at the end of its predicted 35-year it. Annual depreciation is $21429 e. Since the company is not large enough to occupy the entire building it own, it rented space to a tenant at $3,200 per month starting on November 1, 2017. The rent was paid on time on November 1, and the amount received was credited to the Rent Eamed account. However, the tenant has not paid the December rent. The company has worked out an agreement with the tenant, who has promised to pay both December and January rent in full on January 15. The tenanthes agreed not to fall behind again t On November the company rented space to another tenant for $2.899 per month. The tenanted five months rent in advance on that date. The payment was recorded with a credit to the Uneamed Rent account 1 Journal entry worksheet 2 3 4 5 6 10 points Record the adjusting entry related to the company's Insurance eBook Note: Enter debits before credits References Transaction Debit Credit b General Journal Insurance expense Prepaid insurance Record entry Clear entry View general journal Required 2 > 1 1. Use the information to prepare adjusting entries as of December 31, 2017 2. Prepare journal entries to record the first subsequent cash transaction in 2018 for parts cand e. Complete this question by entering your answers in the tabs below. noints Book References Required 1 Required 2 Use the information to prepare adjusting entries as of December 31, 2017 View transaction list Journal entry worksheet 4 5 6 > The company has 15 employees, who earn a total of $2,150 in salaries each working day. They are paid each Monday for their work in the five-day workweek ending on the previous Friday. Assume that December 31, 2017, Tuesday, and all 15 employees worked the first two days of that week Note: Enter debits before credits Transaction General Journal Debit Cred Journal entry worksheet 3 5 6 The company purchased a building on January 1, 2017. It cost $795,000 and is expected to have a $45,000 salvage value at the end of its predicted 35- year life. Annual depreciation is $21,429. Note: Enter debits before credits ences Transaction General Journal Debit Credit Record entry Clear entry View general Journal Required 2 > View ramas 1 Journal entry worksheet 5 6 10 points Since the company is not large enough to occupy the entire building it owns, it rented space to a tenant at $3,200 per month, starting on November 1, 2017 The rent was paid on time on November 1, and the amount received was credited to the Rent Earned account. However, the tenant has not paid the Note: Enter debits before credits eBook References Transaction General Journal Debit Credit Record entry Clear entry View general Journal Required 2 > Journal entry worksheet 3 4 5 6 credited to the Rent Earned account. However, the tenant has not paid the December rent. The company has worked out an agreement with the tenant, who has promised to pay both December and January rent in full on January 15. The tenant has agreed not to fall behind again. Note: Enter debits before credits. ences Transaction General Journal Debit Credit Record entry Clear entry View general Journal Required 2 > Journal entry worksheet