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22 December, 01:38

The ledger of Clayton Company includes the following unadjusted balances: Prepaid Insurance $3,000, Service Revenue $58,000, and Salaries and Wages Expense $25,000. Adjusting entries are required for (a) expired insurance $1,800; (b) services performed $1,100, but unbilled and uncollected; and (c) accrued salaries payable $800.

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  1. 22 December, 04:38
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    The adjusting entries are as follows

    a. Insurance expense A/c Dr $1,200

    To Prepaid insurance A/c $1,200

    (Being the insurance expense is recorded)

    The computation is shown below:

    = $3,000 - $1,800

    = $1,200

    b. Account receivable Dr $1,100

    To Service revenue $1,100

    (Being the service performed is recorded)

    c. Salaries and wages expenses Dr $800

    To Salaries and wages payable $800

    (Being the salaries and wages expense is recorded)
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