The following information is available regarding Hallal Company:

On its December 31, 2001, balance sheet, the company had prepaid rent of $20,000 ($4,000 pe month), which covered the period January 1-May 31, 2002

On May 1,2002, it negotiated a new lease agreement that covered a tgree year period at a rent of $5000 per month, effective June 1, and immediately paid a security deposit of $5000.

This amount will be refunded to the company after the termination of the lease( subject, of course, to the premises being in reasonable condition when vacated).

On June 1, 2002, Hallal Company paid the rent for the next six months of the new lease ($30,000) in advance.

On December 1, the $30,000 rent payment for the next six months (i.e., for the priod December 1, 2002-May 31, 2003) was due. However, because of an administrative error, this was not actually paid until January 2, 2003.

INSTRUCTIONS

(a) Prepare general journal entries to record each of the four transactions. If no entry is required, stateno entry required.

(b) Prepare any adjusting journal entries required to update the rent accounts at December 31, 2002.

(c) How much rent expense should be reported on the companys income statement for the year ending December 31,2002?

(d) Indicate what (if anything) should be reported-on-Hallal-Company's balance sheet as at December 31, 2002, with respect to rent. Be specific.

1.33 The following information is available regarding Hallal Company: Analye trersactions, prepure Thits December 31, 2001, balineeshae, the company had prepaid icnt of $20,000(51,000 per joumal entries and deformine month) which covered the period January 1-May 31, 2002 amounts to be proctilal in the An May-1,2009, it hegotiated a neweleaseagreement that coverod three-vear period at a rent financiaf statements. of $5,000 per monthe effective June , and immodiately paid a "security deposit" of 55000 . This amount will be refundedto the company after theterminatioan of the ease (subject of course, to the premises being in reasonablecondition wher vacatided) On June 1, 2002, Hallal Company paid the rent for the first six months of the new lease ($30,000) in advanoe. Ori December 1, the $30,000 rent payment for the next six months (ie, for the period-December 1,2002 -May 31, 2003) was due. However, becalise of an administrative erron this was not actually paid until lantary 2,2003 ? linsiructions (ia) Prypare general joumal entries to record eadi of the four transactions. If noentry is required, (iv) Prepane aryy adpisting joumbl entries required to update the rent accounts at Deacmber 3,2002 (1) llow much rent expenceshould be reported on the company's incomestatemint for the year Fiting December 31,20022 (1d) Indicate what (if anything) should be reported-on-Hallal Company's balnnce shectas at December 31, 2002, with respect to rent. Be specific. [13.4) Selected accounts of the Nie Company are shown below: (50 6.,7)AP (Atre analysing the acoounts, foumalize (a) the July transactions, and (b) the adjusting entries that Pristrictions were made on July 31 . July transactions were all for cash