Question
Balance Prepaid Insurance $18650 Prepaid Rent $2208 Supplies $1300 Equipment $29000 Accumulated Depreciation - Equipment $2900 Examination of the records shows that adjustments should be
| Balance | |
| Prepaid Insurance | $18650 |
| Prepaid Rent | $2208 |
| Supplies | $1300 |
| Equipment | $29000 |
| Accumulated Depreciation - Equipment | $2900 |
Examination of the records shows that adjustments should be made for the following items, Prepare the annual year end adjusting journal entries at December 31:
a) Of the Prepaid Insurance in the unadjusted trail balance, $8000 is for coverage during the months after December 31st of the current year.
| Date | Description | Debit | Credit |
|---|---|---|---|
| Dec 31 | |||
b) The balance in the Prepaid Rent account is for a 12-month period that started October 1 of the current year.
| Date | Description | Debit | Credit |
|---|---|---|---|
| Dec 31 | |||
c) $220 of interest has been earned on an outstanding Note Receivable but not received or recorded as of December 31st.
| Date | Description | Debit | Credit |
|---|---|---|---|
| Dec 31 | |||
d) Supplies used during the year amount to $1250.
| Date | Description | Debit | Credit |
|---|---|---|---|
| Dec 31 | |||
e)The equipment was originally purchased on January 1, 2014. The company calculates annual depreaciation to be $2900.
| Date | Description | Debit | Credit |
|---|---|---|---|
| Dec 31 | |||
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Operational Auditing
Authors: David G Komatz
1st Edition
B09K24NM14, 979-8751454357
