5 Part 1 of 3 4.85 points ! Required information [The following information applies to the questions displayed below.] Wells Technical Institute (WTI) provides training to individuals who pay tuition directly to the school. WTI also offers training to groups in off-site locations. WTI initially records prepaid expenses and unearned revenues in balance sheet accounts. Its unadjusted trial balance as of December 31 follows, along with descriptions of items a through h that require adjusting entries on December 31. Additional Information Items eBook a. An analysis of WTI's insurance policies shows that $2,674 of coverage has expired. References b. An inventory count shows that teaching supplies costing $2,318 are available at year-end. c. Annual depreciation on the equipment is $10,698. d. Annual depreciation on the professional library is $5,349. e. On September 1, WTI agreed to do five training courses for a client for $2,400 each. Two courses will start immediately and finish before the end of the year. Three courses will not begin until next year. The client paid $12,000 cash in advance for all five training courses on September 1, and WTI credited Unearned Revenue. f. On October 15, WTI agreed to teach a four-month class (beginning immediately) for an executive with payment due at the end of the class. At December 31, $7,153 of the tuition revenue has been earned by WTI. g. WTI's two employees are paid weekly. As of the end of the year, two days' salaries have accrued at the rate of $100 per day for each employee. h. The balance in the Prepaid Rent account represents rent for December. Cash Accounts receivable Teaching supplies Prepaid insurance Prepaid rent Professional library WELLS TECHNICAL INSTITUTE Unadjusted Trial Balance December 31 Accumulated depreciation-Professional library Equipment Accumulated depreciation-Equipment Accounts payable Salaries payable Unearned revenue Common stock Retained earnings Dividends Tuition revenue Training revenue Depreciation expense-Professional library Depreciation expense-Equipment Salaries expense Insurance expense Rent expense Teaching supplies expense Advertising expense Utilities expense Totals Debit Credit $ 26,491 0 10,187 15,284 2,039 30,565 $ 9,171 103,000 16,303 21,000 0 12,000 30,380 81,000 40,755 103,924 38,717 0 0 48,907 0 22,429 0 7,132 5,706 $ 312,495 $ 312,495 Required: 1. Prepare the necessary adjusting journal entries for items a through h. Assume that adjusting entries are made only at year-end. View transaction list Journal entry worksheet 2 3 4 5 6 7 8 An analysis of WTI's insurance policies shows that $2,674 of coverage has expired. Note: Enter debits before credits. Transaction General Journal Debit Credit a. Insurance expense 2,674 Prepaid insurance 2,674 Record entry Clear entry View general journal > Required: 1. Prepare the necessary adjusting journal entries for items a through h. Assume that adjusting entries are made only at year-end. View transaction list Journal entry worksheet 1 2 3 4 5 6 7 8 An inventory count shows that teaching supplies costing $2,318 are available at year-end. Note: Enter debits before credits. Transaction General Journal Debit Credit b. Teaching supplies expense 2,318 Teaching supplies 2,318 Record entry Clear entry View general journal > Required: 1. Prepare the necessary adjusting journal entries for items a through h. Assume that adjusting entries are made only at year-end. View transaction list Journal entry worksheet 1 2 3 4 5 6 7 8 > Annual depreciation on the equipment is $10,698. Note: Enter debits before credits. Transaction General Journal Debit Credit C. Depreciation expense-Equipment 10,698 Accumulated depreciation-Equipment 10,698 Record entry Clear entry View general journal Required: 1. Prepare the necessary adjusting journal entries for items a through h. Assume that adjusting entries are made only at year-end. View transaction list Journal entry worksheet Annual depreciation on the professional library is $5,349. Note: Enter debits before credits. Transaction General Journal d. Depreciation expense-Professional library Accumulated depreciation-Professional library Debit Credit 5,349 5,349 Record entry Clear entry View general journal Required: 1. Prepare the necessary adjusting journal entries for items a through h. Assume that adjusting entries are made only at year-end. View transaction list Journal entry worksheet 1 2 3 4 5 6 7 8 On September 1, WTI agreed to do five training courses for a client for $2,400 each. Two courses will start immediately and finish before the end of the year. Three courses will not begin until next year. The client paid $12,000 cash in advance for all five training courses on September 1, and WTI credited Note: Enter debits before credits. Transaction General Journal e. Unearned revenue Training revenue Cash Debit Credit 2,400 2,400 12,000 Record entry Clear entry View general journal Required: 1. Prepare the necessary adjusting journal entries for items a through h. Assume that adjusting entries are made only at year-end. View transaction list Journal entry worksheet 1 2 3 4 5 6 7 8 On October 15, WTI agreed to teach a four-month class (beginning immediately) for an executive with payment due at the end of the class. At December 31, $7,153 of the tuition revenue has been earned by WTI. Note: Enter debits before credits. Transaction General Journal f. Accounts receivable Tuition revenue Debit Credit 7,153 7,153 View general journal Record entry Clear entry > Required: 1. Prepare the necessary adjusting journal entries for items a through h. Assume that adjusting entries are made only at year-end. View transaction list Journal entry worksheet