Mike Maroscia, D.D.S., opened a dental practice on January 1, 1996. During the first month of operations
Question:
Mike Maroscia, D.D.S., opened a dental practice on January 1, 1996. During the first month of operations the following transactions occurred.
1. Performed services for patients who had dental plan insurance. At January \(31, \$ 750\) of such services was earned but not yet billed to the insurance companies.
2. Utility expenses incurred but not paid prior to January 31 totaled \(\$ 650\).
3. Purchased dental equipment on January 1 for \(\$ 80,000\), paying \(\$ 20,000\) in cash and signing a \(\$ 60,000\), three-year-note payable. The equipment depreciates \(\$ 400\) per month. Interest is \(\$ 600\) per month.
4. Purchased a one-year malpractice insurance policy on January 1 for \(\$ 12,000\).
5. Purchased \(\$ 1,800\) of dental supplies. On January 31, determined that \(\$ 500\) of supplies were on hand.
\section*{Instructions}
Prepare the adjusting entries on January 31. Account titles are: Accumulated DepreciationDental Equipment, Depreciation Expense, Fees Earned, Accounts Receivable, Insurance Expense, Interest Expense, Interest Payable, Prepaid Insurance, Supplies, Supplies Expense, Utilities Expense, and Utilities Payable.
Step by Step Answer:
Financial Accounting
ISBN: 9780471169208
2nd Edition
Authors: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso