Norell Inc. experienced the following accounting events during its 2018 accounti

Question

Norell Inc. experienced the following accounting events during its 2018 accounting period Required a. Identify the events that would require a year-end adjusting entry. Year-End Adjusting Entry Events 1. Recognized revenue on account. 2. Issued common stock 3. Paid cash to purchase supplies. 4. Collected a cash advance for services that will be provided during the coming year. 5. Paid a cash dividend to the stockholders. 6. Paid cash for an insurance policy that provides coverage during the next year. 7. Collected cash from accounts receivable. 8. Paid cash for operating expenses. 9. Paid cash to settle an account payable 10. Paid cash to purchase land. b. Are adjusting or closing entries recorded first? OAdjusting entries Closing entries

Explanation / Answer

a.

b. Adjusting entries are recorded first.

Events Year End Adjusting Entry 1. No 2. No 3. No 4. Yes 5. No. 6. Yes 7. No 8. No 9. No. 10. No

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