Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Pharoah Quest Games adjusts its accounts annually. Assume that any prepaid expenses are initially recorded in asset accounts. Assume that any revenue collected in advance
Pharoah Quest Games adjusts its accounts annually. Assume that any prepaid expenses are initially recorded in asset accounts. Assume that any revenue collected in advance is initially recorded as liabilities. The following information is available for the year ended December 31, 2024: 1. A $3,540 one-year insurance policy was purchased on April 1, 2024. 2. Paid $5,450 on August 31,2024 , for five months' rent in advance. 3. On September 27,2024 , received $3,450 cash from a corporation that sponsors games for the most improved students attending a nearby school. The $3,450 was for 10 games, worth $345 each, that are played on the first Friday of each month starting in October. (Use the Unearned Revenue for the initial entry and Service Revenue for the adjusting entry.) 4. Signed a contract for cleaning services starting December 1,2024 , for $490 per month. Paid for the first three months on November 30, 2024. (Use Prepaid Expenses for the initial entry and Office Expense for the adjusting entry.) 5. On December 15,2024 , sold $870 of gift certificates to a local gaming club. On December 31,2024 , determined that $570 of these gift certificates had not yet been redeemed. (Use the account Unearned Revenue.) (a) For each transaction, prepare the journal entry to record the initial transaction. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List all debit entries before credit entries.)
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