E4-8 Recording Seven Typical Adjusting Entries LO4-1 [The following information applies to the questions displayed below.] Dittman's Variety Store is completing the accounting process for the current year just ended, December 31. The transactions during year have been journalized and posted. The following data with respect to adjusting entries are available: a. Wages earned by employees during December, unpaid and unrecorded at December 31, amounted to $3,400. The last payroll was December 28; the next payroll will be January 6. b. Office supplies on hand at January 1 of the current year totaled $550. Office supplies purchased and debited to Office Supplies during the year amounted to $680. The year-end count showed $255 of supplies on hand. c. One-fourth of the basement space is rented to Heald's Specialty Shop for $490 per month, payable monthly. At the end of the current year, the rent for November and December had not been collected or recorded. Collection is expected in January of the next year. d. The store used delivery equipment all year that cost $65,500; $11,800 was the estimated annual depreciation. e. On July 1 of the current year, a two-year insurance premium amounting to $3,120 was paid in cash and debited in full to Prepaid Insurance. Coverage began on July 1 of the current year. f. The remaining basement of the store is rented for $1,600 per month to another merchant, M. Carlos, Inc. Carlos sells compatible, but not competitive, merchandise. On November 1 of the current year, the store collected six months' rent in the amount of $9,600 in advance from Carlos; it was credited in full to Unearned Rent Revenue when collected. g. Dittman's Variety Store operates a repair shop to meet its own needs. The shop also does repairs for M. Carlos. At the end of the current year, Carlos had not paid $800 for completed repairs. This amount has not yet been recorded as Repair Shop Revenue. Collection is expected during January of next year. References Section Break E4-8 Recording Seven Typical Adjusting Entries LO4-1 E4-8 Part 1 Required: 1. Identify each of the above transactions as a deferred revenue, deferred expense, accrued revenue, or accrued expense. a. b. C. d. e. f. g. E4-8 Part 2 2. Prepare the adjusting entries that should be recorded for Dittman's Variety Store at December 31 of the current year. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet 1 2 3 4 5 6 7 Wages earned by employees during December, unpaid and unrecorded at December 31, amounted to $3,400. The last payroll was December 28; the next payroll will be January 6. Note: Enter debits before credits. Transaction General Journal Debit Credit a. Record entry Clear entry View general journal X 1 Wages earned by employees during December, unpaid and unrecorded at December 31, amounted to $3,400. The last payroll was December 28; the next payroll will be January 6. d at 3; th 2 Office supplies on hand at January 1 of the current year totaled $550. Office supplies purchased and debited to Office Supplies during the year amounted to $680. The year-end count showed $255 of supplies on hand. Cr 3 One-fourth of the basement space is rented to Heald's Specialty Shop for $490 per month, payable monthly. At the end of the current year, the rent for November and December had not been collected or recorded. Collection is expected in January of the next year. Note : = journal entry has been entered Record entry Clear entry View View transaction list X 4 ine store used delivery equipment all year that cost $65,500; $11,800 was the estimated annual depreciation. 5 d at 3; th On July 1 of the current year, a two-year insurance premium amounting to $3,120 was paid in cash and debited in full to Prepaid Insurance. Coverage began on July 1 of the current year. 6 C The remaining basement of the store is rented for $1,600 per month to another merchant, M. Carlos, Inc. Carlos sells compatible, but not competitive, merchandise. On November 1 of the current year, the store collected six months' rent in the amount of $9,600 in advance from Carlos; it was credited in full to Unearned Rent Revenue when collected. Note: journal entry has been entered Credit 7 Dittman's Variety Store operates a repair shop to meet its own needs. The shop also does repairs for M. Carlos. At the end of the current year, Carlos had not paid $800 for completed repairs. This amount has not yet been recorded as Repair Shop Revenue. Collection is expected during January of next year. Note : = journal entry has been entered Record entry Clear entry View general journ- E4-8 Recording Seven Typical Adjusting Entries LO4-1 [The following information applies to the questions displayed below.] Dittman's Variety Store is completing the accounting process for the current year just ended, December 31. The transactions during year have been journalized and posted. The following data with respect to adjusting entries are available: a. Wages earned by employees during December, unpaid and unrecorded at December 31, amounted to $3,400. The last payroll was December 28; the next payroll will be January 6. b. Office supplies on hand at January 1 of the current year totaled $550. Office supplies purchased and debited to Office Supplies during the year amounted to $680. The year-end count showed $255 of supplies on hand. c. One-fourth of the basement space is rented to Heald's Specialty Shop for $490 per month, payable monthly. At the end of the current year, the rent for November and December had not been collected or recorded. Collection is expected in January of the next year. d. The store used delivery equipment all year that cost $65,500; $11,800 was the estimated annual depreciation. e. On July 1 of the current year, a two-year insurance premium amounting to $3,120 was paid in cash and debited in full to Prepaid Insurance. Coverage began on July 1 of the current year. f. The remaining basement of the store is rented for $1,600 per month to another merchant, M. Carlos, Inc. Carlos sells compatible, but not competitive, merchandise. On November 1 of the current year, the store collected six months' rent in the amount of $9,600 in advance from Carlos; it was credited in full to Unearned Rent Revenue when collected. g. Dittman's Variety Store operates a repair shop to meet its own needs. The shop also does repairs for M. Carlos. At the end of the current year, Carlos had not paid $800 for completed repairs. This amount has not yet been recorded as Repair Shop Revenue. Collection is expected during January of next year. References Section Break E4-8 Recording Seven Typical Adjusting Entries LO4-1 E4-8 Part 1 Required: 1. Identify each of the above transactions as a deferred revenue, deferred expense, accrued revenue, or accrued expense. a. b. C. d. e. f. g. E4-8 Part 2 2. Prepare the adjusting entries that should be recorded for Dittman's Variety Store at December 31 of the current year. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet 1 2 3 4 5 6 7 Wages earned by employees during December, unpaid and unrecorded at December 31, amounted to $3,400. The last payroll was December 28; the next payroll will be January 6. Note: Enter debits before credits. Transaction General Journal Debit Credit a. Record entry Clear entry View general journal X 1 Wages earned by employees during December, unpaid and unrecorded at December 31, amounted to $3,400. The last payroll was December 28; the next payroll will be January 6. d at 3; th 2 Office supplies on hand at January 1 of the current year totaled $550. Office supplies purchased and debited to Office Supplies during the year amounted to $680. The year-end count showed $255 of supplies on hand. Cr 3 One-fourth of the basement space is rented to Heald's Specialty Shop for $490 per month, payable monthly. At the end of the current year, the rent for November and December had not been collected or recorded. Collection is expected in January of the next year. Note : = journal entry has been entered Record entry Clear entry View View transaction list X 4 ine store used delivery equipment all year that cost $65,500; $11,800 was the estimated annual depreciation. 5 d at 3; th On July 1 of the current year, a two-year insurance premium amounting to $3,120 was paid in cash and debited in full to Prepaid Insurance. Coverage began on July 1 of the current year. 6 C The remaining basement of the store is rented for $1,600 per month to another merchant, M. Carlos, Inc. Carlos sells compatible, but not competitive, merchandise. On November 1 of the current year, the store collected six months' rent in the amount of $9,600 in advance from Carlos; it was credited in full to Unearned Rent Revenue when collected. Note: journal entry has been entered Credit 7 Dittman's Variety Store operates a repair shop to meet its own needs. The shop also does repairs for M. Carlos. At the end of the current year, Carlos had not paid $800 for completed repairs. This amount has not yet been recorded as Repair Shop Revenue. Collection is expected during January of next year. Note : = journal entry has been entered Record entry Clear entry View general journ