Rowland Company is a small editorial services company owned and operated by Marl
ID: 2334642 • Letter: R
Question
Rowland Company is a small editorial services company owned and operated by Marlene Rowland. On August 31, 2018, the end of the current year, Rowland Company’s accounting clerk prepared the following unadjusted trial balance:
Rowland Company
UNADJUSTED TRIAL BALANCE
August 31, 2018
1
Cash
7,655.00
2
Accounts Receivable
38,345.00
3
Prepaid Insurance
7,075.00
4
Supplies
2,290.00
5
Land
113,500.00
6
Building
149,450.00
7
Accumulated Depreciation-Building
87,905.00
8
Equipment
133,250.00
9
Accumulated Depreciation-Equipment
96,435.00
10
Accounts Payable
11,860.00
11
Unearned Rent
6,705.00
12
Common Stock
74,530.00
13
Retained Earnings
146,290.00
14
Dividends
14,690.00
15
Fees Earned
328,600.00
16
Salaries and Wages Expense
198,220.00
17
Utilities Expense
42,120.00
18
Advertising Expense
22,315.00
19
Repairs Expense
17,210.00
20
Miscellaneous Expense
6,205.00
21
Totals
752,325.00
752,325.00
The data needed to determine year-end adjustments are as follows:
Chart of Accounts
Journal
1. Journalize the adjusting entries using the following additional accounts: Salaries and Wages Payable; Rent Revenue; Insurance Expense; Depreciation Expense—Building; Depreciation Expense—Equipment; and Supplies Expense. Refer to the Chart of Accounts for exact wording of account titles.
PAGE 10
JOURNAL
ACCOUNTING EQUATION
1
Adjusting Entries
2
3
4
5
6
7
8
9
10
11
12
13
14
15
Adjusted Trial Balance
2. Determine the balances of the accounts affected by the adjusting entries, and prepare an adjusted trial balance.
Rowland Company
ADJUSTED TRIAL BALANCE
August 31, 2018
1
Cash
2
Accounts Receivable
3
Prepaid Insurance
4
Supplies
5
Land
6
Building
7
Accumulated Depreciation-Building
8
Equipment
9
Accumulated Depreciation-Equipment
10
Accounts Payable
11
Unearned Rent
12
Salaries and Wages Payable
13
Common Stock
14
Retained Earnings
15
Dividends
16
Fees Earned
17
Rent Revenue
18
Salaries and Wages Expense
19
Utilities Expense
20
Advertising Expense
21
Repairs Expense
22
Depreciation Expense-Building
23
Depreciation Expense-Equipment
24
Insurance Expense
25
Supplies Expense
26
Miscellaneous Expense
27
Totals
ACCOUNT TITLE DEBIT CREDIT1
Cash
7,655.00
2
Accounts Receivable
38,345.00
3
Prepaid Insurance
7,075.00
4
Supplies
2,290.00
5
Land
113,500.00
6
Building
149,450.00
7
Accumulated Depreciation-Building
87,905.00
8
Equipment
133,250.00
9
Accumulated Depreciation-Equipment
96,435.00
10
Accounts Payable
11,860.00
11
Unearned Rent
6,705.00
12
Common Stock
74,530.00
13
Retained Earnings
146,290.00
14
Dividends
14,690.00
15
Fees Earned
328,600.00
16
Salaries and Wages Expense
198,220.00
17
Utilities Expense
42,120.00
18
Advertising Expense
22,315.00
19
Repairs Expense
17,210.00
20
Miscellaneous Expense
6,205.00
21
Totals
752,325.00
752,325.00
Explanation / Answer
Rowland Company
Date
Account Titles and Explanation
Ref. No.
Debit
Credit
31-Aug
Insurance Expense
$1,215
Prepaid Insurance
$1,215
(To record prepaid insurance expired during the period)
b.
Supplies Expense
$1,745
Supplies
$1,745
(To record cost of supplies used during the period)
c.
Depreciation Expense - Building
$7,985
Accumulated Depreciation - Building
$7,985
(To record depreciation expense on building)
d.
Depreciation Expense - Equipment
$4,080
Accumulated Depreciation - Equipment
$4,080
(To record depreciation expense on equipment)
e.
Unearned Rent
$5,560
Rent Revenue
$5,560
(To record rent earned during the period)
f.
Salaries and Wages Expense
$3,490
Salaries and Wages Payable
$3,490
(To record unpaid salaries and wages)
g.
Accounts Receivable
$11,640
Fees Earned
11,640
(To record fees earned)
Balances of the accounts affected by the adjusting entries -
1. Insurance expense = $1,215
2. Prepaid Insurance = $5,860
3. Supplies expense = $1,745
4 . Supplies = $545
5. Depreciation expense - buildings = $7,985
6. Accumulated depreciation - buildings = $95,890
beginning balance = $87,905
add: dep. Expense = $7,985
7. Depreciation expense - equipment = $4,080
8. Accumulated dep. Equipment - = $100,515
beginning balance = $96,435
add: dep. Expense = $4,080
9. Rent Revenue = $5,560
10. Unearned rent = $1,145
11. Salaries and wages expense = $201,710
beginning balance = $198,220
add: salaries and wages payable = $3,490
12. Salaries and Wages Payable = $3,490
13. Accounts Receivable =$49,985
Beginning balance = $38,345
Add: fee earned but unbilled =$11,640
14. Fee earned = $340,240
beginning balance = $328,600
Add: unbilled = 11,640
Rowland Company
Adjusted Trial Balance
as on August 31, 2018
Account Title
Debit
Credit
1
Cash
$7,655
2
Accounts Receivable
$49,985
3
Prepaid Insurance
$5,860
4
Supplies
$545
5
Land
$113,500
6
Building
$149,450
7
Accumulated Depreciation - Building
$95,890
8
Equipment
$133,250
9
Accumulated Depreciation - Equipment
$100,515
10
Accounts Payable
$11,860
11
Unearned Rent
$1,145
12
Salaries and Wages Payable
$3,490
13
Common Stock
$74,530
14
Retained Earnings
$146,290
15
Dividends
$14,690
16
Fees Earned
$340,240
17
Rent Revenue
$5,560
18
Salaries and Wages Expense
$201,710
19
Utilities Expense
$42,120
20
Advertising Expense
$22,315
21
Repairs Expense
$17,210
22
Depreciation Expense - Building
$7,985
23
Depreciation Expense - Equipment
$4,080
24
Insurance Expense
$1,215
25
Supplies Expense
$1,745
26
Miscellaneous Expense
$6,205
27
Totals
$779,520
$779,520
Date
Account Titles and Explanation
Ref. No.
Debit
Credit
31-Aug
Insurance Expense
$1,215
Prepaid Insurance
$1,215
(To record prepaid insurance expired during the period)
b.
Supplies Expense
$1,745
Supplies
$1,745
(To record cost of supplies used during the period)
c.
Depreciation Expense - Building
$7,985
Accumulated Depreciation - Building
$7,985
(To record depreciation expense on building)
d.
Depreciation Expense - Equipment
$4,080
Accumulated Depreciation - Equipment
$4,080
(To record depreciation expense on equipment)
e.
Unearned Rent
$5,560
Rent Revenue
$5,560
(To record rent earned during the period)
f.
Salaries and Wages Expense
$3,490
Salaries and Wages Payable
$3,490
(To record unpaid salaries and wages)
g.
Accounts Receivable
$11,640
Fees Earned
11,640
(To record fees earned)
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