ournalize the adjusting entry needed on

December

31, the company's year-end, for each of the following independent cases affecting

Prairie

Construction:

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Part 1

a. Details of the Prepaid Rent account reveal a beginning balance of

$4,500

and debits to the account on March 31 of

$9,000

and on

September

30 of

$9,000.

Prairie

Construction pays office rent semiannually on March 31 and September 30. At December 31, part of the last payment is still available to cover January to March of the next year. Record the rent expense for the year ended

December 31.

No rent expense was recorded during the year. (Record debits first, then credits. Enter explanations on the last line.)

Journal Entry
Date		Accounts	Debit	Credit
Dec.	31	Rent Expense	18,000
		Prepaid Rent		18,000
		To record rent expense.

Part 2

b.

Prairie

Construction has lent money to help employees find housing, receiving note receivable in return. During the current year, the entity has earned interest revenue of

$1,400

from employees' loans, which it will receive next year.

Record the interest revenue earned during the current year.

Journal Entry
Date		Accounts	Debit	Credit
Dec.	31	Interest Receivable	1,400
		Interest Revenue		1,400
		To accrue interest revenue.

Part 3

c. The beginning balance of Supplies was

$5,100.

During the year, the company purchased supplies costing

$16,500,

and at

December 31,

the inventory of supplies remaining on hand is

$5,500.

Record the supplies expense for the year.

Journal Entry
Date		Accounts	Debit	Credit
Dec.	31

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Independent cases

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a.

Details of Prepaid Rent are shown in the account:

Prepaid Rent
Jan.	1	Bal.	4,500
Mar.	31		9,000
Sep.	30		9,000

Prairie

Construction pays office rent semi-annually on March 31 and September 30. At December 31, part of the last payment is still available to cover January to March of the next year. No rent expense was recorded during the year.

b.

Prairie

Construction has lent money to help employees find housing, receiving notes receivable in return. During the current year, the entity has earned interest revenue of

$1,400

from employees' loans, which it will receive next year.

c.

The beginning balance of Supplies was

$5,100.

During the year, the company purchased supplies costing

$16,500,

and at

December 31

the inventory of supplies remaining on hand is

$5,500.

d.

Prairie

Construction is installing cable in a large building, and the owner of the building paid

Prairie

Construction

$42,000

as the annual service fee.

Prairie

Construction recorded this amount as Unearned Service Revenue.

Robin Zweig,

the general manager, estimates that the company has earned

one-fourth

of the total fee during the current year.

e.

Prairie

Construction pays its employees each Friday. The amount of the weekly payroll is

$5,000

for a five-day workweek, and the daily salary amounts are equal. The current accounting period ends on

Wednesday.

f.

Amortization expenses for the current year includes Equipment,

$14,000;

and Trucks,

$33,000.

Record this as a compound entry.

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