Adjusting Entries - (4)

1. The records of ISU include the following as of June 1, 2010. The PPE has a balance of $133,000. Depreciation for the month of June 2010 has been estimated at $12,500. What will the balance in the Accumulated Depreciation account be after the related adjustment is recorded on June 30, 2010?

1. $120,500

2. $145,500

3. $587,500

4. $612,500

Question 2

1. On October 1, 2010, ABC co. Paid $75,000 for its rent for five months from October 2010 through February 2011. The entire amount of the payment was recorded in the prepaid rent account. No adjustments have been recorded. If the company makes an adjustment as of December 31, 2010, what amount should be included in the adjusting entry?

1. $30,000

2. $ 45,000

3. $ 60,000

4. $75,000

Question 3

1. On February 1 ABC borrowed $11,000 and signed a note that promises repayment in a year. The interest rate was 7% annually. The adjusting entry on December 31 will include:

1. Debit to interest Expense of $706

2. Debit to Interest Payable of $675

3. Credit to Interest Expense of $706

4. Credit to Interest Payable of $11,000