Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

P3.10A (LO 2, 3, 4) AP Reyes Rides is owned by Jason Reyes. The company has an August 31 fiscal year end and prepares adjustments

P3.10A (LO 2, 3, 4) AP Reyes Rides is owned by Jason Reyes. The company has an August 31 fiscal year end and prepares adjustments on an annual basis. The following is an alphabetical list of its accounts at August 31, 2021, before adjustments. All accounts have normal balances.

Prepare and post adjusting entries, and prepare adjusted trial balance.

Accounts payable $5,700 J. Reyes, drawings $141,000

Accounts receivable 7,080 Notes payable 162,000

Accumulated depreciationequipment 25,200 Prepaid insurance 12,660

Accumulated depreciationvehicles 175,500 Rent expense 22,810

Cash 9,000 Salaries expense 140,625

Equipment 40,320 Service revenue 334,300

Fuel expense 23,972 Supplies 4,455

Interest expense 9,653 Unearned revenue 25,000

J. Reyes, capital 105,075 Vehicles 421,200

Additional information:

On August 31, a physical count shows $850 of supplies on hand.

The insurance policy has a one-year term that began on November 1, 2020.

The equipment has an estimated useful life of 10 years. The vehicles have an estimated useful life of 12 years.

The company collects cash in advance for any special services requested by customers. As at August 31, the company has provided all but $4,500 of these services.

The note payable has an annual interest rate of 4.5%. Interest is paid on the first day of each month.

Employees are paid a combined total of $545 per day. At August 31, 2021, five days of salaries are unpaid.

On August 31, the company provided $1,350 of services for a senior citizens' group. The group was not billed for the services until September 2.

Additional fuel costs of $620 have been incurred but not recorded. (Use the Accounts Payable account.)

Instructions

a. Prepare T accounts and enter the unadjusted trial balance amounts.

b. Journalize the annual adjusting entries at August 31, 2021.

c. Post the adjusting entries.

d. Prepare an adjusted trial balance at August 31, 2021.

Taking It Further As at August 31, 2021, approximately how old are the equipment and vehicles?

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Management Research Methods

Authors: Phyllis Tharenou, Ross Donohue, Brian Cooper

1st Edition

0521694280, 9780521694285

More Books

Students also viewed these Accounting questions

Question

What is a decision table?

Answered: 1 week ago