Wells Technical Institute (WTI), a school owned by Tristana Wells, provides training to individuals who pay tuition directly to the school WTI also offers training to groups in off site locations WTI initially records prepaid expenses and unearned revenues in balance sheet accounts Its unadjusted trial balance as of December 31 follows along with descriptions of items a through hthat require adjusting entries on December 31 Additional Information Items An analysis of WTI's insurance policies shows that $3,203 of coverage has expired An inventory count shows that teaching supplies costing $2,776 are available at year end Annual depreciation on the equipment is $12,814 Annual depreciation on the professional library is $6,407 On September 1, WTI agreed to do five courses for a client for $2,800 each Two courses will start immediately and finish before the end of the year Three courses will not begin until next year The client paid $14,000 cash in advance for all five courses on September 1, and WTI credited Unearned Training Fees On October 15, WTI agreed to teach a four month class (beginning immediately) for an executive with payment due at the end of the class At December 31, $8,750 of the tuition has been earned by WTI WTI's two employees are paid weekly As of the end of the year, two days' salaries have accrued at the rate of $100 per day for each employee The balance in the Prepaid Rent account represents rent for December WELLS TECHNICAL INSTITUTE Unadjusted Trial Balance December 31DebitCreditCash$27,245Accounts receivable0Teaching supplies10,478Prepaid insurance15,719Prepaid rent2,097Professional library31,436Accumulated depreciationProfessional library$9,432Equipment73,338Accumulated depreciationEquipment16,768Accounts payable35,249Salaries payable0Unearned training fees14,000T Wells, Capital66,646T Wells, Withdrawals41,916Tuition fees earned106,885Training fees earned39,820Depreciation expenseProfessional library0Depreciation expenseEquipment0Salaries expense50,300Insurance expense0Rent expense23,067Teaching supplies expense0Advertising expense7,336Utilities expense5,868Totals$288,800$288,800 Required 1 Prepare the necessary adjusting journal entries for items a through h Assume that adjusting entries are made only at year end

The Answer is in the image, click to view ...

Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on Nov 18, 2024

Wells Technical Institute (WTI), a school owned by Tristana Wells, provides training to individuals who pay tuition directly to the school. WTI also offers training

Wells Technical Institute (WTI), a school owned by Tristana Wells, provides training to individuals who pay tuition directly to the school. WTI also offers training to groups in off-site locations. WTI initially records prepaid expenses and unearned revenues in balance sheet accounts. Its unadjusted trial balance as of December 31 follows along with descriptions of items a through hthat require adjusting entries on December 31.

Additional Information Items

An analysis of WTI's insurance policies shows that $3,203 of coverage has expired.
An inventory count shows that teaching supplies costing $2,776 are available at year-end.
Annual depreciation on the equipment is $12,814.
Annual depreciation on the professional library is $6,407.
On September 1, WTI agreed to do five courses for a client for $2,800 each. Two courses will start immediately and finish before the end of the year. Three courses will not begin until next year. The client paid $14,000 cash in advance for all five courses on September 1, and WTI credited Unearned Training Fees.
On October 15, WTI agreed to teach a four-month class (beginning immediately) for an executive with payment due at the end of the class. At December 31, $8,750 of the tuition has been earned by WTI.
WTI's two employees are paid weekly. As of the end of the year, two days' salaries have accrued at the rate of $100 per day for each employee.
The balance in the Prepaid Rent account represents rent for December.

WELLS TECHNICAL INSTITUTE

Unadjusted Trial Balance

December 31DebitCreditCash$27,245Accounts receivable0Teaching supplies10,478Prepaid insurance15,719Prepaid rent2,097Professional library31,436Accumulated depreciationProfessional library$9,432Equipment73,338Accumulated depreciationEquipment16,768Accounts payable35,249Salaries payable0Unearned training fees14,000T. Wells, Capital66,646T. Wells, Withdrawals41,916Tuition fees earned106,885Training fees earned39,820Depreciation expenseProfessional library0Depreciation expenseEquipment0Salaries expense50,300Insurance expense0Rent expense23,067Teaching supplies expense0Advertising expense7,336Utilities expense5,868Totals$288,800$288,800

Required:

1.Prepare the necessary adjusting journal entries for itemsathroughh. Assume that adjusting entries are made only at year-end.