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15 April, 00:23

Prepare adjusting journal entries, as needed, for the following items. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) The Supplies account shows a balance of $570, but a count of supplies reveals only $200 on hand at year-end. The company initially records the payments of all insurance premiums as prepaid insurance. The unadjusted trial balance at year-end shows a balance of $570 in Prepaid Insurance. A review of insurance policies reveals that $190 of insurance is unexpired. Employees work Monday through Friday, and salaries of $3,200 per week are paid each Friday. The company's year-end falls on Tuesday. At year-end, the company received a utility bill for December's electricity usage of $270 that will be paid in early January.

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  1. 15 April, 02:23
    0
    The adjusting entries are shown below:

    1. Supplies expense A/c Dr $370

    To supplies A/c $370

    (Being supplies account is adjusted)

    The supplies expense is computed by

    = Supplies balance - supplies on hand

    = $570 - $200

    = $370

    2. Insurance expense A/c Dr $190

    To Prepaid Insurance $190

    (Being prepaid insurance is adjusted)

    3. Salaries expense A/c $1,280

    To Salaries payable A/c $1,280

    (Being salary is adjusted)

    The salaries expense is computed by

    = Total five days * number of days : total number of days

    = $3,200 * (2 : 5)

    = $1,280

    4. Electricity expense A/c Dr $270

    To electricity payable A/c $270

    (Being electricity usage is adjusted)
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