Question
E3-6B (Adjusting Entries) Cheng, D.D.S., opened a dental practice on January 1, 2014. During the first month of operations the following transactions occurred. 1. Performed
E3-6B (Adjusting Entries) Cheng, D.D.S., opened a dental practice on January 1, 2014. During the first month of operations the following transactions occurred.
1. Performed services for patients who had dental plan insurance. At January 31, $375 of such ser- vices was performed but not yet billed to the insurance companies.
2. Utility expenses incurred but not paid prior to January 31 totaled $260.
3. Purchased dental equipment on January 1 for $40,000, paying $10,000 in cash and signing a
$30,000, 3-year note payable. The equipment depreciates $200 per month. Interest is $250 per
month.
4. Purchased a one-year malpractice insurance policy on January 1 for $6,000.
5. Purchased $800 of dental supplies. On January 31, determined that $250 of supplies were on hand.
Instructions
Prepare the adjusting entries on January 31. Account titles are:
Accumulated DepreciationEquipment Interest Payable Depreciation Expense Prepaid Insurance Service Revenue Supplies
Accounts Receivable Supplies Expense Insurance Expense Utilities Expense Interest Expense Utilities Payable
P3-10B (Adjusting and Closing) Presented below is the December 31 trial balance of Juno Beach
6 7 Clothing, Inc.
JUNO BEACH CLOTHING, INC.
TRIAL BALANCE
DECEMBER 31
Debit Credit
Cash $ 23,850
Accounts Receivable 16,000
Allowance for Doubtful Accounts $ 600
Inventory, December 31 | 73,600 |
| |
Prepaid Insurance | 5,200 | ||
Equipment | 60,000 | ||
Accumulated DepreciationEquipment |
|
| 26,000 |
Notes Payable |
|
| 21,000 |
Accounts Payable |
|
| 18,400 |
Common Stock |
|
| 10,000 |
Retained Earnings |
|
| 76,550 |
Sales Revenue |
|
| 397,300 |
Cost of Goods Sold | 204,150 |
|
|
Salaries and Wages Expense (sales) | 56,850 |
|
|
Advertising Expense | 26,700 |
|
|
Salaries and Wages Expense (administrative) | 79,300 |
|
|
Supplies Expense | 4,200 |
|
|
| $549,850 |
| $549,850 |
Instructions
(a) Construct T-accounts and enter the balances shown.
(b) Prepare adjusting journal entries for the following and post to the T-accounts. (Omit explana-
tions.) Open additional T-accounts as necessary. (The books are closed yearly on December 31.)
1. Bad debt expense is estimated to be $1,600.
2. Equipment is depreciated based on a 8-year life (no salvage value).
3. Insurance expired during the year $3,650.
4. Interest accrued on notes payable $2,050.
5. Sales salaries and wages earned but not paid $2,750.
6. Advertising paid in advance $1,100.
7. Office supplies on hand $900, charged to Supplies Expense when purchased.
(c) Prepare closing entries and post to the accounts.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
![blur-text-image](https://dsd5zvtm8ll6.cloudfront.net/includes/images/document_product_info/blur-text-image.webp)
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
![blur-text-image](https://dsd5zvtm8ll6.cloudfront.net/includes/images/document_product_info/blur-subtext-image.webp)
Step: 3
![blur-text-image](https://dsd5zvtm8ll6.cloudfront.net/includes/images/document_product_info/blur-subtext-image.webp)
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started