Answered step by step
Verified Expert Solution
Question
1 Approved Answer
P3.4 ( (LO2,3) A review of the ledger of Bellingham Accountants at December 31, 2025, produces the following data pertaining to the preparation of annual
P3.4 ( (LO2,3) A review of the ledger of Bellingham Accountants at December 31, 2025, produces the following data pertaining to the preparation of annual adjusting entries. 1. Prepaid Insurance 10,340. The company has separate insurance policies on its buildings and its motor vehicles. Policy B4564 on the building was purchased on April 1, 2024, for 7,920. The policy has a term of 3 years. Policy A2958 on the vehicles was purchased on January 1, 2025, for 4,400. This policy has a term of 2 years. 1. Insurance expense 4,840 2. Unearned Rent Revenue 378,000. The company began subleasing office space in its new building on November 1 . At December 31 , the company had the following rental contracts that are paid in full for the entire term of the lease. 2. Rent revenue 75,500 3. Notes Payable 120,000. This balance consists of a note for 9 months at an annual interest rate of 6%, dated November 1 . 3. Interest expense 1,200 4. Salaries and Wages Payable 0. There are eight salaried employees. Salaries are paid every Friday for the current week. Five employees receive a salary of 700 each per week, and three employees earn 500 each per week. Assume December 31 is a Tuesday. Employees do not work weekends. All employees worked the last 2 days of December. 4. Salaries and wages expense 2,000 Instructions Prepare the adjusting entries at December 31, 2025. Journalize transactions and follow through accounting cycle to preparation of financial statements
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started