paily pa ufor Ta months of insurance coverage on June 1,2012. 5. On December 1,2
ID: 2542536 • Letter: P
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paily pa ufor Ta months of insurance coverage on June 1,2012. 5. On December 1,2012, Garrett Wolfe collected $30,000 for consulting services to be performed from December 1,2012, through March 31,2013. 6. Garrett Wolfe performed consulting services for a client in December 2012. The client will be billed $4,200. Garrett wolfe Company pays its employees total salaries of $9.000 every Monday for the preceding 5-day week (Monday through Friday). On Monday, December 29, employees were paid for the week ending December 26. All employees worked the last 3 days of 2012. Instructions Prepare adjusting entries for the seven items described above. E3-6 J. Marten Company accumulates the following adjustment data at December 31. 1. Services provided but not recorded total $1,000. 2. Supplies of $300 have been used. 3. Utility expenses of $225 are unpaid. 4. Unearned service revenue of $260 has been earned 5. Salaries of $800 are unpaid. 6. Prepaid insurance totaling $350 has expired. ldenify types of adjustme and account relationships (SO 4, 5, 6) Instructions For each of the above items indicate the following. (a) The type of adjustment (prepaid expense, unearned revenue, accrued revenue, or accrued expense). (b) The status of accounts before adjustment (overstatement or understatement). Prepare adjusting entries E3-7 The ledger of Danieal Rental Agency on March 31 of the current year includes the selected account data selected accounts, shown on the next page, before adjusting entries have been prepared. (SO 5, 6)Explanation / Answer
Req 1: Type of Adjustment S.no. Adjustment Type 1 Services provided not recorded Accrued revenue 2 Supplies used Prepaid expense 3 Utilities unpaid Accrued expense 4 Unearned revenue earned Unearned revenue 5 Salaries unpaid Accrued expense 6 Prerpaid insurance Prepaid expense Req 2: Status of accounts before adjustment. S.no. Adjustment Overstated Account Understated Account 1 Services provided not recorded Service revenue and Accounts receivable 2 Supplies used Supplies Supplies expense 3 Utilities unpaid Utilities expense and utilities payable 4 Unearned revenue earned Unearned revenue Service revenue 5 Salaries unpaid Salaries expense and Salaries payable 6 Prerpaid insurance Prepaid Insurance Insurance expense
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