ADJUSTING ENTRIES AND POSTING TO T ACCOUNTS Prepare the required adjusting journal entry for each situation as of December 31, 2010 See the last page for the unadjusted account balances shown in T accounts (a) Suppose Deanas had received a $1,800 shipment of supplies in September 2010 When counting the supplies on December 31, 2010, Deanas found only $800 worth of supplies on hand Debit and credit the accounts affected Dec 31 2010 (b) Suppose Deanas had paid $12,000 for six months rent on November 1, 2010 As of December, 31, 2010, two months (November December) prepaid rent has expired Debit and credit the accounts affected Dec 31 2010 (c) Suppose Deanas had paid $6,000 for one years insurance on June 1, 2010 Debit and credit the accounts affected Dec 31 2010 (d) The company had acquired Property, Plant Equipment costing $40,000 on January 1, 2010 Suppose that the depreciation on this Equipment was calculated to be $2,000 for 2010 Debit and credit the accounts affected HW 4 1, continued (e) On December 1, 2010, the company had sold $500 in gift certificates for decorating services to a customer On December 31, 2010, the accountant received an envelope containing $400 worth of redeemed gift certificates, not yet recorded in the companys books Debit and credit the accounts affected Dec 31 2010 (f) On June 30, 2010, the company invested $20,000 in a certificate of deposit that will yield 12 interest at the end of one year Debit and credit the accounts affected Dec 31 2010 (g) The company borrowed a note payable from the bank for $30,000 on January 1, 2010, due with all interest on June 30, 2011 The note payable requires 10 interest Debit and credit the accounts affected Dec 31 2010 (h) The company calculated its income taxes as $26,110 for the year ended December 31, 2010 Debit and credit the accounts affected Dec 31 2010 (i) On December 15, 2010, the company declared a $750 dividend, payable January 15, 2011 Debit and credit the accounts affected Dec 31 2010 Post the adjusting entries above to the T accounts on the following page HW 4 1, continued Assets Liabilities Stockholders Equity Cash Unadj 43,450 Supplies Unadj 1,800 Accounts Receivable Unadj 4,000 Prepaid Rent Unadj 12,000 Prepaid Insurance Unadj 6,000 Certificate of Deposit Unadj 20,000 Interest Receivable Unadj 0 Property, Plant Equipment Unadj 40,000 Accumulated Depr 0 Unadj Accounts Payable 250 Unadj Dividend Payable 0 Unadj Unearned Revenue 500 Unadj Notes Payable 30,000 Unadj Interest Payable 0 Unadj Income Taxes Payable 0 Unadj Stockholders Equity Depreciation Expense Interest Expense Income Tax Expense Contributed Capital 10,000 Unadj Retained Earnings 0 Unadj Dividends Declared Unadj 0 Decorating Revenue 120,000 Unadj Interest Revenue Wage Expense Unadj 32,000 Utilities Expense Unadj 1,000 Telephone Expense Unadj 500 Supplies Expense Rent Expense Insurance Expense HW 4 2 Prepare the adjusted trial balance for Deanas Decorators Deanas Decorators Adjusted Trial Balance December 31, 2010 Debit Credit Cash Supplies Accounts Receivable Prepaid Rent Prepaid Insurance Certificate of Deposit Interest Receivable Property, Plant Equipment Accumulated Depreciation Accounts Payable Dividend Payable Unearned Revenue Notes Payable Interest Payable Income Taxes Payable Contributed Capital Retained Earnings Dividends Declared Decorating Revenue Interest Revenue Wage Expense Utilities Expense Telephone Expense Supplies Expense Rent Expense Insurance Expense Depreciation Expense Interest Expense Income Tax Expense Totals HW 4 3 Prepare the financial statements for Deanaa Decorators FINANCIAL STATEMENTS Deanas Decorators Income Statement For the year ended December 31, 2010 Deanas Decorators Statement of Retained Earnings For the year ended December 31, 2010 HW 4 3, continued Deanas Decorators Balance Sheet December 31, 2010 Assets Liabilities Stockholders Equity HW 4 4 CLOSING ENTRIES, POSTING TO T ACCOUNTS, PREPARATION OF POST CLOSING TRIAL BALANCE For Deanas Decorators, prepare the required closing entries Post the entries to the T accounts shown on the next page Then, prepare a post closing trial balance Date Accounts Debit Credit Post the adjusting entries above to the T accounts on the page 3 Then, prepare the post closing trial balance HW 4 4, continued Deanas Decorators Post Closing Trial Balance December 31, 2010 Account Debit Credit Cash Supplies Accounts Receivable Prepaid Rent Prepaid Insurance Certificate of Deposit Interest Receivable Property, Plant Equipment PP E Accumulated Depreciation Accounts Payable Dividend Payable Unearned Revenue Notes Payable Interest Payable Income Taxes Payable Contributed Capital Retained Earnings Dividends Declared Decorating Revenue Interest Revenue Wage Expense Utilities Expense Telephone Expense Supplies Expense Rent Expense Insurance Expense Depreciation Expense Interest Expense Income Tax Expense Totals

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ADJUSTING ENTRIES AND POSTING TO T-ACCOUNTS Prepare the required adjusting journal entry for each situation as of December 31, 2010. See the last page for

ADJUSTING ENTRIES AND POSTING TO T-ACCOUNTS

Prepare the required adjusting journal entry for each situation as of December 31, 2010. See the last page for the unadjusted account balances shown in T-accounts.

(a) Suppose Deanas had received a $1,800 shipment of supplies in September 2010. When counting the supplies on December 31, 2010, Deanas found only $800 worth of supplies on hand.