Williams Cleaning and Maintenance, owned by Erica Williams, provides cleaning services to hotels, motels, and hospitals. On January 31, 2019, the firm's worksheet showed the following adjustment data. The balances of the revenue and expense accounts listed in the Income Statement section of the worksheet and the drawing account listed in the Balance Sheet section of the worksheet are also given.
ADJUSTMENTS
a. Supplies used, $8,580
b. Expired insurance, $4,440
c. Depreciation on machinery, $3,360
REVENUE AND EXPENSE ACCOUNTS
401 Fees Income........................................................................$98,400 Cr.
511 Depreciation Expense-Machinery................................................3,360 Dr.
514 Insurance Expense....................................................................4,440 Dr.
517 Rent Expense..........................................................................9,000 Dr.
520 Salaries Expense......................................................................48,000 Dr.
523 Supplies Expense......................................................................8,580 Dr.
526 Telephone Expense......................................................................630 Dr.
529 Utilities Expense......................................................................1,920 Dr.
DRAWING ACCOUNT
302 Erica Williams, Drawing.............................................................7,200 Dr.
INSTRUCTIONS
1. Record the adjusting entries in the general journal, page 3.
2. Record the closing entries in the general journal, page 4. Use account numbers provided in
Mini-Practice Set 1 for any account number not given.
Analyze: What effect did the adjusting entry for expired insurance have on the Insurance Expense account?