Today is the first day of July. To simplify the recording of transactions in the new accounting period, you are required to journalize appropriate reversing entries into the general journal and post these to the general ledger.

Instructions for reversing entries

1)Using the adjusting entries information and the post-closing trial balance for the month of June, record in the general journal any entries that are required to reverse the following adjusting entries from that month:

Electricity expense incurred but not paid Water expense incurred but not paid Wages owed to the employees but have not yet been paid in cash Interest expense incurred but not paid to the lender Interest earned but not received in cash Note that all ledger accounts presented on this page have normal opening balances.

Adjusting entries information Using the following information, you will record end of month adjustments: Office Furniture owned by the business: original purchase price was $8,000, estimated useful life was 6 years, and estimated residual value was $1,500 at the end of the useful life. Depreciation is calculated on a monthly basis using the straight line method. The monthly depreciation charge is calculated as the yearly depreciation expense divided by the number of months in a year. Office Equipment owned by the business: original purchase price was $41,000, estimated useful life was 11 years, and estimated residual value was $5,000 at the end of the useful life. Depreciation is calculated on a monthly basis using the straight line method. The monthly depreciation charge is calculated as the yearly depreciation expense divided by the number of months i a year. Electricity expense for the month of June is estimated to be $827. The water usage for the month of June is estimated to be $211. Sales staff work every single day during the week including weekends and are not paid until the end of each two weeks. Wages were last paid up to and including June 28. Wages incurred after that day (from June 29 to June 30 inclusive) are estimated to have been $680 per day. Interest expense incurred during the month of June but not yet paid to Earth Bank for the bank loan is $205. Interest earned from short-term investments in ZNZ Bank for the month of June is $100. Office supplies totalling $2,567 are still on hand at June 30. 2 months of rent remained pre-paid at the start of June. 3 months of advertising remained pre-paid at the start of June. 5 months of insurance remained pre-paid at the start of June. When calculating the portion of prepayments that expire during the month of June, you are asked to assume that an equal amount of expense is incurred per month. Print Close Hi-Fi Way Post-closing Trial Balance June 30, 2020 Debit Credit Account No. Name 87,169 20,000 5,951 100 57,986 2,567 2,500 8,000 2,600 8,000 100 Cash 102 Short-term Investments 110 ARC - Accounts Receivable Control 112 Interest Receivable 120 Merchandise Inventory 130 Office Supplies 140 Prepaid Rent 141 Prepaid Advertising 142 Prepaid Insurance 150 Office Furniture 151 Accum Depn: Office Furniture 160 Office Equipment 161 Accum Depn: Office Equipment 210 APC - Accounts Payable Control 220 Wages Payable 221 Electricity Payable 222 Water Payable 225 Interest Payable 250 Bank Loan Payable 300 Common Stock 301 Retained Earnings 1,625 41,000 16,637 660 1,360 827 211 205 41,000 65,000 108,348 Total 235,873 235,873 Print Close Adjusting entries information Using the following information, you will record end of month adjustments: Office Furniture owned by the business: original purchase price was $8,000, estimated useful life was 6 years, and estimated residual value was $1,500 at the end of the useful life. Depreciation is calculated on a monthly basis using the straight line method. The monthly depreciation charge is calculated as the yearly depreciation expense divided by the number of months in a year. Office Equipment owned by the business: original purchase price was $41,000, estimated useful life was 11 years, and estimated residual value was $5,000 at the end of the useful life. Depreciation is calculated on a monthly basis using the straight line method. The monthly depreciation charge is calculated as the yearly depreciation expense divided by the number of months i a year. Electricity expense for the month of June is estimated to be $827. The water usage for the month of June is estimated to be $211. Sales staff work every single day during the week including weekends and are not paid until the end of each two weeks. Wages were last paid up to and including June 28. Wages incurred after that day (from June 29 to June 30 inclusive) are estimated to have been $680 per day. Interest expense incurred during the month of June but not yet paid to Earth Bank for the bank loan is $205. Interest earned from short-term investments in ZNZ Bank for the month of June is $100. Office supplies totalling $2,567 are still on hand at June 30. 2 months of rent remained pre-paid at the start of June. 3 months of advertising remained pre-paid at the start of June. 5 months of insurance remained pre-paid at the start of June. When calculating the portion of prepayments that expire during the month of June, you are asked to assume that an equal amount of expense is incurred per month. Print Close Hi-Fi Way Post-closing Trial Balance June 30, 2020 Debit Credit Account No. Name 87,169 20,000 5,951 100 57,986 2,567 2,500 8,000 2,600 8,000 100 Cash 102 Short-term Investments 110 ARC - Accounts Receivable Control 112 Interest Receivable 120 Merchandise Inventory 130 Office Supplies 140 Prepaid Rent 141 Prepaid Advertising 142 Prepaid Insurance 150 Office Furniture 151 Accum Depn: Office Furniture 160 Office Equipment 161 Accum Depn: Office Equipment 210 APC - Accounts Payable Control 220 Wages Payable 221 Electricity Payable 222 Water Payable 225 Interest Payable 250 Bank Loan Payable 300 Common Stock 301 Retained Earnings 1,625 41,000 16,637 660 1,360 827 211 205 41,000 65,000 108,348 Total 235,873 235,873 Print Close