Exercises

Identify which type of adjustment is indicated by these transactions. Choose accrued revenue, accrued expense, deferred revenue, or deferred expense.

a$.$ Rent paid in advance for use of property.

b$.$ Cash recelved in advance for future services.

c$.$ Supplies inventory purchased.

d$.$ Fees earned but not yet collected.

The following accounts were used to make year$-$end adjustments. Identify the related account that is associated with this account $($the other account in the adjusting entry$).$

a$.$ Salaries Payable

b$.$ Depreciation Expense

c$.$ Supplies

d$.$ Unearned Rent

At the end of the current year, $$95,500$ of fees have been earned but have not been billed to clients.

a$.$ Journalize the adjusting entry to record the accrued fees.

b$.$ If the cash basis rather than the accrual basis had been used, would an adjusting entry have been necessary? Why or why not?