Question
Pitman Company is a small editorial services company owned and operated by Jan Pitman. On October 31, 2019 the end of the current year, Pitman
Pitman Company is a small editorial services company owned and operated by Jan Pitman. On October 31, 2019 the end of the current year, Pitman Companys accounting clerk prepared the following unadjusted trial balance:
Pitman Company
UNADJUSTED TRIAL BALANCE
October 31, 2019
ACCOUNT TITLE | DEBIT | CREDIT | |
---|---|---|---|
1 | Cash | 7,655.00 |
|
2 | Accounts Receivable | 38,345.00 |
|
3 | Prepaid Insurance | 7,075.00 |
|
4 | Supplies | 2,290.00 |
|
5 | Land | 113,500.00 |
|
6 | Building | 149,450.00 |
|
7 | Accumulated Depreciation-Building |
| 87,905.00 |
8 | Equipment | 133,250.00 |
|
9 | Accumulated Depreciation-Equipment |
| 96,435.00 |
10 | Accounts Payable |
| 11,860.00 |
11 | Unearned Rent |
| 6,705.00 |
12 | Jan Pitman, Capital |
| 220,820.00 |
13 | Jan Pitman, Drawing | 14,690.00 |
|
14 | Fees Earned |
| 328,600.00 |
15 | Salaries and Wages Expense | 198,220.00 |
|
16 | Utilities Expense | 42,120.00 |
|
17 | Advertising Expense | 22,315.00 |
|
18 | Repairs Expense | 17,210.00 |
|
19 | Miscellaneous Expense | 6,205.00 |
|
20 | Totals | 752,325.00 | 752,325.00 |
The data needed to determine year-end adjustments are as follows:
a. | Unexpired insurance at October 31, $5,860. |
b. | Supplies on hand at October 31, $545. |
c. | Depreciation of building for the year, $7,985. |
d. | Depreciation of equipment for the year, $4,080. |
e. | Unearned rent at October 31, $1,145. |
f. | Accrued salaries and wages at October 31, $3,490. |
g. | Fees earned but unbilled on October 31, $11,640. |
Required: | |
1. | Journalize the adjusting entries using the following additional accounts: Salaries and Wages Payable, Rent Revenue, Insurance Expense, Depreciation ExpenseBuilding, Depreciation ExpenseEquipment and Supplies Expense. Refer to the Chart of Accounts for exact wording of account titles. |
2. | Determine the balances of the accounts affected by the adjusting entries and prepare an adjusted trial balance. |
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