\text{Accounts receivable} &181 &170\\ C) Land. B) A liability on the balance sheet. Adjusting entries are usually entered in the work sheet before they are entered in the general D) A debit to Unearned Rent and a credit to Rent Revenue for $2,400. Debit Supplies Expense $805 and credit Supplies $805. B) A debit to a prepaid expense and a credit to Cash for $5,625. $33,400 statement. The accrual basis of accounting: The industry average for the current ratio is 1. A) Cash basis accounting. Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. $40,650. $60,000 ($52,000 cash received from customers); Incurred expenses of $35,000 ($31,000 cash The daily profit for a product is given by P=420x0.1x24100P=420 x-0.1 x^2-4100P=420x0.1x24100 dollars, where x is the number of units produced and sold. Q:Several items are omitted from the income statement andcost of goods manufacturedstatement data fo A:Direct materials used= Materials beginning + materials purchased - materials ending \text{Assets}\\ Copyright 2023 StudeerSnel B.V., Keizersgracht 424, 1016 GC Amsterdam, KVK: 56829787, BTW: NL852321363B01. The balance in the prepaid insurance account before adjustment at the end of the year is $5,200, and no adjustments had been made previously. All rights reserved. It is acceptable to record cash received in advance of providing products or services to indicates that Flo's can cover its short term liabilities with its short term assets. There was no beginning balance in the Unearned Revenue account for the period. Beginning Supplies + Supplies Purchased Ending Supplies = Supplies Used C) Time period assumption. C) $6,000. During the closing process, Retained Earnings is closed to the Dividends account. A market analyst wants to know if the new website he designed is showing increased page views per visit. All rights reserved. services required by the contract were completed. C) Cash basis accounting. On April 1, Garcia Publishing Company received $32,580 from Otisco, Inc. for 36-month subscriptions to several different magazines. All necessary amounts needed to prepare the income statement can be taken from the 61450 Bonds Payable B) $21,000. Median response time is 34 minutes for paid subscribers and may be longer for promotional offers. \text{Income before tax} &42\\ Debit Insurance Expense, $4,500 Credit Prepaid Insurance, $4,500. recorded. Debit Retained earnings $50,800; credit Dividends $50,800, Accounting 203-Tindall (quiz question review), Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Don Herrmann, J. David Spiceland, Wayne Thomas, Fundamental Financial Accounting Concepts, Alvin A Arens, Mark A Beasley, Randal J Elder. \end{array} Assuming the college prepares adjustments monthly, what amount of tuition revenue should the college recognize on February 28? D) An asset on the balance sheet. Chris is married but filing separately, with a taxable income of $127,500\$ 127,500$127,500. $1, A:If the carrying value of the bonds is more than the redemption value, then there will be gain on red Q:P21.11 (LO 2, 3) Groupwork (Lessee-Lessor Accounting for Residual Q:Alpha Plc manufactures and sells a single product and has a standard costing system in which purchas A:Standard costing is a system used by managers to assess a business unit's performance by keeping clo Q:How much is the cost of goods sold using the specific identification On October 15, a company received $15,000 cash as a down payment on a consulting What is the correct closing entry for the expense accounts? Prior to recording adjusting entries, the Office Supplies account had a $388 debit balance. 18,750 The adjusting entry on December 31 of the b. operating on the pleasure principle. If the monthly accounting period ends on Tuesday 218510. Incurred but unpaid expenses that are recorded during the adjusting process with a debit to D) Result in a debit to a liability and a credit to an asset account. B) Prepaid expenses. A debit to a prepaid expense and a credit to Cash for $7,500. Copyright 2019 McGraw-Hill Education. A) A debit to an expense and credit to a prepaid expense for $7,500. E) Revenue basis accounting. It is an advanced method for adding overheads to product cost, Q:How much of the following is gross income subject to income tax? D) Are listed on the balance sheet as liabilities. Copyright 2019 McGraw-Hill Education. B) Net sales divided by assets. \text{Income Statement}\\ D) Expense recognition (Matching) principle. C) $4,000. current ratio is 0. A) 85%. E) A financing activity on the statement of cash flows. income under the accrual basis of accounting is: The Unearned Rent account balance at the end of December, after adjustment, should be: $2,400 Its net sales for October were $14,000. E) Income statement accounts. A company purchased new furniture at a cost of $34,000 on September 30. C) Accrued revenue. Given The furniture is estimated to have a useful life of 4 years and a salvage value of $4,000. A company had no supplies available at the beginning of August. period. contract. On July 1 of the current calendar year, Plum Co. paid $7,500 cash for management services to be performed over a two-year period beginning July 1. All rights reserved. adjusting entry is made at the end of the period to bring the asset account balance to the correct Harrod Company paid $5,200 for a 4-month insurance premium in advance on November 1, with coverage beginning on that date. 11 All rights reserved. amounted to $3,500. Its net sales for October were What will be the insurance expense on the annual income statement for the first year ended December 31? A) Debit Unpaid Salaries $600 and credit Salaries Payable $600. Total D) Assuring that financial statements reflect the revenues earned and the expenses incurred. A:First, find the cost of ending inventory and then deduct it from the total cost to compute the cost Q:Numble Inc., manufactures boxed stationery. $6,000 $3,600 = $2,400. D) A debit to a prepaid expense and a credit to an expense for $1,875. Income Summary account has a credit balance of $6,000, and its Dividends account has a debit What pH\mathrm{pH}pH values define an acid, a base, and a neutral substance? B) At the end of one accounting period often result in cash payments in the next period. A company had revenues of $51,000 and expenses of $41,750 for the accounting period. supplies is $3,200. C) Recognizes revenues when received in cash. On April 1, Otisco, Inc. paid Garcia Publishing Company $1,620 for 36-month subscriptions to several different magazines. The internal control is the control that is set up in business so that there is no any error Q:Required: \text{Prepaid insurance}& 7 &12\\ Multiple Choice C) A debit to Cash and a credit to Rent Revenue for $6,400. During the period, the company completed $6,200 of the agreed-on services for the client. The gross income is the income which is subject to tax before any deductions. For the year ended December 31, a company had revenues of $196,000 and expenses of $117,600. Common Sto A:The question is based on the concept of Financial Accounting. ALVR Digital Bank granted a loan to a client A:Interest Income -It is the amount of money paid by the borrower over and above the loan amount to t Q:Bonds that pay no interest unless the issuing company is profitable Purposive Communication Module 2, Recrystallization of Benzoic Acid Lab Report, 46 modelo de carta de renuncia voluntaria, Leadership class , week 3 executive summary, I am doing my essay on the Ted Talk titaled How One Photo Captured a Humanitie Crisis https, School-Plan - School Plan of San Juan Integrated School, SEC-502-RS-Dispositions Self-Assessment Survey T3 (1), Techniques DE Separation ET Analyse EN Biochimi 1. c. focusing solely on the morality of an issue. \text{Liabilities}\\ was initially recorded as Unearned Revenue. The approach to preparing financial statements based on recognizing revenues when they method of inventory valuation? Depreciation measures the decline in market value of an asset. Assuming adjusting entries are only made at year-end, the If total revenues for the period are $80,200, total expenses are $58,800, and dividends are $13,500, what is the ending balance in the Retained earnings account after all closing entries are made? 2-year old animals = 10 - 3 Q:Compare and contrast the built-in loss duplication rule as it relates to 351 with the built-in loss A:The term "complete liquidation" refers to the situation in which a company is unable to continue ope Q:Presented below is information related toBonitaInc.s inventory. Multiple Choice E) Assuring that external transaction amounts remain unchanged. Assuming adjustments are only made at year-end, what is the adjusting entry that should be recorded by Garcia Publishing Company on December 31 of the first year? What is the correct closing entry for the revenue accounts? B) Debit Salaries Expense $400 and credit Salaries Payable $400. 19 Assuming the company does not prepare reversing entries, which of the following entries would B) $21,000. Depreciation expense is an example of an accrued expense. Accrued expenses at the end of one accounting period are expected to result in cash \text{Salaries expense} &55\\ a. The difference between the cost of an asset and the accumulated depreciation for that asset A company paid $9,000 for a twelve-month insurance policy on February 1. A debit to a prepaid expense and a credit to an expense for $1,925. Is the graph of the function concave up or down? Adjusting entries always affect the cash account. C) Prepaid Depreciation. the same period. &\$852& \$856\\ gal business Debit Income Summary $44,300; credit Expense accounts $44,300. $6,000 worth of supplies in August and recorded the purchase in the Supplies account. In Q:Freddy is a director of Ace Finance Ltd. Under the effective interest method , the bond is recognized using the pres Q:4. Salaries Expense (Debit) 2,500 On July 1 Olive Co. paid $7,500 cash for management services to be performed over a two-year period. The company uses the A) At the end of one accounting period result in cash receipts in a future period. Ending Balance, 31 Dec The cash receipt was credited to the Unearned Rent account. zero balances. Depreciation of equipment for the year, 2,800. year period. 18,375 h. Shareholders were paid cash dividends of $30 million.\. The policy The industry average for the current ratio is 1.2. Select one: The balance in the supplies account, before adjustment at the end of the year, is 5,330. Which of the following accounts showing a balance on the post-closing trial balance indicate an error? Direct materia A:Given details: A) Affect only income statement accounts. The cash basis of accounting is a system in which revenues are recorded when earned and The retained earnings account before closing had a balance of $303,000. Castillo Services paid K. Castillo, the sole shareholder of Castillo Services, $5,500 in dividends during the current year. mbling activities. How much depreciation expense will be recorded for the furniture for the first year ended December 31? debit Unearned Fees, $8,145; credit Fees Earned, $8,145 18 of 30 Next income statement columns of the work sheet, including the net income or net loss. These balances indicate that net income for the current accounting period The Retained earnings account has a credit balance of $54,000 before closing entries are made. E) An overstatement of assets. Olive follows a policy of recording all prepaid expenses to asset accounts at the time unanimousl A:The Corporation Act is the act which impose or levy number of additional fiduciary duties on the dir Q:A self-employed taxpayer may be eligible to deduct amounts paid for medical insurance for themselves A:Medical insurance is a kind of insurance plan/scheme which offers the insured, financial security or Q:PICO Ltd is a manufacturer of picnic tables of varying sizes. The accrual basis of accounting recognizes expenses when cash is paid. A) Accrued expense. Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. \text{Less: Allowance for uncollectible accounts} &(8)& (6)\\ columns, a net loss is indicated. It is very necessary to check and verify that the transaction transferred to ledgers from the journal are accurately, At the end of every accounting period Adjustment Entries are made in order to adjust the accounts precisely replicate the expenses and revenue of the current period. Use the marginal tax rates in Table 4.94.94.9 to compute the tax owed in the following situation. Dividends 41,000, $179,000 18,375 A company's fiscal year must correspond with the calendar year. Actual price per meter = $382,500/62,500 m A long-term investment in bonds, originally purchased for$30 million, was sold for $35 million. An unadjusted trial balance is a list of accounts and balances prepared before adjustments are Net Copyright 2019 McGraw-Hill Education. a. Graph this function for x between 0 and 4200 . B) Items that require adjusting entries. D) $6,750. After posting the entries to close all revenue and expense accounts, the Income Summary A post-closing trial balance is a list of permanent accounts and their balances from the account balance to the correct unearned amount. \text{Less: Discount on bonds }&(22) &(25)\\ Flo's Flowers' current ratio is 1. journal. record the salaries earned but unpaid is: statement. 1 and recorded it as unearned revenue. A) Result in a debit to an expense and a credit to an asset account. On October 1, Vista View Company rented warehouse space to a tenant for $1,200 per month and received $6,000 for five months' rent in advance on that date, with the lease beginning immediately. High Step Shoes had annual revenues of $202,000, expenses of $112,200, and paid dividends of $24,800 during the current year. 60, A:Net Operating Income: A company performs 20 days of work on a 30-day contract before the end of the year. 22,250 On September 1, Kennedy Company loaned $112,000, at 9% annual interest, to a customer. On July 1 of the current calendar year, Olive Co. paid $7,500 cash for management High Step Shoes had annual revenues of $186,000, expenses of $104,200, and paid dividends of $18,400 during the current year. A physical count of supplies on hand at the end of May for Masters, Inc. indicated $1,245 of supplies on hand. called Unearned Legal Fees. The note receivable plus interest will not be collected until March 1 of the following year. You can specify conditions of storing and accessing cookies in your browser. The Dividends account is normally closed by debiting it. Pong Incorporated's income statement for the most recent month is given below. Credit Cash $23,000. of $1,500 from this contract for October. D) A credit to a prepaid expense and a debit to Cash for $7,500. Revenues $202,000 Expenses $112,200 = Net Income $89,800. On the work sheet, net income is entered in the Income Statement Credit column as well as C) Cause an accrued liability account to exist. The steps in the closing process are (1) close credit balances in revenue accounts to Income Since the services will be per. On July 1, Friler Company purchased a 1-year insurance policy by paying 5,400. C) Debit Salaries Expense and credit Cash. \text{Investment revenue} &15\\ total contract is valued at $6,000 and payment is not due until the contract is fully completed. D) $6,500. subtracted from the balance of the related account is a(n): If the company fails to make the end-of-period adjusting entry to business or services, returns, discounts Q:Ayo Company started 2022 with P94,000 of merchandise inventory on &\$852& \$856\\ D) Accrual basis accounting. closure. . that were earned as a result of the expenses is the: E) Is referred to as an accrued asset. temporary accounts, and (2) all temporary accounts have zero balances. The required adjusting entry is: Debit Office Supplies Expense $290 and credit Office Supplies $290. \text{Less: Accumulated depreciation }&(85)& (75)\\ is called C) Debit Prepaid Insurance, $360; credit Insurance Expense, $360. B) $3,500. The entry to close the dividends account at the end of the year is: Debit Retained earnings $5,500; credit Dividends $5,500. ledger after all closing entries are journalized and posted. Management services fee per month = $7,500/24 = $312.5 From July 1 to December 31 of the current year, management services has been performed for 6 months. B) An understatement of equity. E) 46%. B) $2,900. accounting period as the revenue earned as a result of these expenses. Closing entries are designed to transfer the end-of-period balances in the revenue accounts, Cash (Credit) 5,600. On a work sheet, if the Debit total exceeds the Credit total of the Income Statement The company paid $50,800 in dividends during the year. Q:5. Useful for showing a business' operating results and and shows the percent of profit in each dollar of sales, Less:Allowanceforuncollectibleaccounts, Claudia Bienias Gilbertson, Debra Gentene, Mark W Lehman, Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Fundamentals of Financial Management, Concise Edition, Don Herrmann, J. David Spiceland, Wayne Thomas. The total amount of depreciation recorded against an asset over the entire time the asset has A company had no office supplies available at the beginning of the year. The fir A:Note: 1/10, n/30: Here, 1 represent the discount rate if payment is made within ten days. A) Record external transactions and events. The following transactions occurred during 2 A:Shareholder's Equity Adjusting entries result in a better matching of revenues and expenses for the period. the expense accounts, and the dividends account to retained earnings. on October 1, at a monthly rate of $800. All of the following statements regarding profit margin are true except : specified accounting procedures. revenues earned. b. years = $7,500 Payment/Fee of tax What is the amount of insurance expense that would appear on the company's income statement for the first year ended December 31? Reece Financial Services accounting clerk prepared the following unadjusted trial balance at July 31, 2019: The data needed to determine year-end adjustments are as follows: Depreciation of building for the year, 6,400. Because it is a necessary financial statement, the work sheet must be prepared according to Chase Company has 10 employees, who earn a total of $1,800 in salaries each working day. Two accounting principles that are relied on in the adjusting process are: What is pH\mathrm{pH}pH ? C) Affect both income statement and balance sheet accounts. 8 $5,200 2/4 = $2,600. The note receivable plus interest will not be collected until March 1 of the following year. fees had been earned. Net operating income (NOI) decides an element's or alternately property's inco Q:Assume Rajan Manufacturing Ltd makes sports vest for local soccer, baseball, basketball, and other s Q:Which of the data above should be ignored in making the special-order decision? A:Gross Income -It is the total income from all sources i.e. If investors observe multiple "red flags" when doing an accounting policy analysis, Copyright 2019 McGraw-Hill Education. 96,836 Prepare journal entries for Garcia to record the collection ofrent and the related year-end adjusting entry on December 31. relevant range of production =10000 to 20000 units Retained earnings 124,800 A ledger is an account that provides information on all the transactions that have taken place during a particular period. 21,875 25000 What is the proper adjusting entry at December 31, the end of the accounting period, if the balance in the prepaid insurance account is $7,750 before adjustment, and the unexpired amount per analysis of policies is $3,250? On November 1, Jasper Company loaned another company $250,000 at a 12.0% interest rate. On July 1, a client paid an advance payment (retainer) of $5,000 to cover future legal services. prepared. This indicates that Flo's can cover its short term liabilities with its short term assets. regardless of when the goods or services are provided. It A:Trade discount = List price x Single discount rate e. The right to use a building was acquired with a seven-year lease agreement; present value of lease payments, $80 million. A) Accumulated depreciation. The adjusting entry on December 31 of the current year for Olive would include: 1 See answer in a future period. How much depreciation expense will be recorded for the A debit to Cash for $7,500 and a credit to an expense for $7,500. The company should recognize the revenue and the employees worked on both Monday and Tuesday, the month-end adjusting entry to Normally closing entries are first entered in the general journal and then posted to the work B) Debit Salaries Payable and credit Salaries Expense. Q:Sarasota Company has the following stockholders equity accounts at December 31, 2020. AssetsCash$57$55Accountsreceivable181170Less:Allowanceforuncollectibleaccounts(8)(6)Prepaidinsurance712Inventory170165Long-terminvestment6690Land150150Buildingsandequipment290270Less:Accumulateddepreciation(85)(75)Trademark2425$852$856LiabilitiesAccountspayable$30$45Salariespayable38Deferredtaxliability1815Leaseliability680Bondspayable145275Less:Discountonbonds(22)(25)ShareholdersEquityCommonstock310290Paid-incapitalexcessofpar9585Preferredstock500Retainedearnings155163$852$856\begin{array}{lrr} The adjusting entry on December 31 of the current year for Olive would include: c. Pretax accounting income exceeded taxable income, causing the deferred income tax liability to increase by$3 million. In the given case, \text{Gain on sale of investments} &5 &\$ 340\\ Account Tit A:Solution All rights reserved. C) Unearned expenses. It is considering switching to the ABC A:Activity based costing(ABC method) : C) An unearned revenue on the income statement. On July 1 Olive should record: hand. Some undamaged sections were sold for$3 million. in come statement for the first year ended December 31? The next payday is January 3, at which time $23,000 will be paid. An adjusting entry was made on year-end December 31 to accrue salary expense of $1,200. The Current ratio is a ratio which is considered as a liquidity ratio. f. $130 million of bonds were retired at maturity. Its profit margin is: On July 1 of the current calendar year, Olive Co. paid $7,700 cash for management services to be performed over a two-year period beginning July 1. The Balance Sheet columns will balance on completing the work sheet but with the wrong net income, if the amount sorted in error is: A liability amount placed in the Income Statement Credit column. The board of directors for Ace Finance Ltd have It earned $25,000 of the On July 1 Olive Co. paid $7,500 cash for management services to be performed over a two-year period. What is the adjusting entry for accruing interest that Milton would need to make on December 31, the calendar year-end? Assuming adjustments are only made at year-end, the adjusting entry on What was the scale factor used? for a five-day week that begins on Monday. For the year ended December 31, a company has revenues of $319,000 and expenses of $197,000. Two main accounting principles used in accrual accounting are expense recognition and full On July 1 Olive should record: Solution: A debit to a prepaid expense and a credit to Cash for $7,500 Solution : A debit to a prepaid expense and a credit to Cash for $ 7,500 13. ifferences would likely exist in your own behavior if you were in a contingent or temporary job versus a traditional permanent job? And if pay Q:) Refer to the following data: A) $2,700. E) None of the answer choices is correct. The Retained earnings account has a credit balance of $46,000 before closing entries are made. \text{Inventory }&170& 165\\ $150,000 The adjusting entry on December 31 of the current year for Olive would include: A debit to an expense and a credit to a prepaid expense for $1,925. Plum follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. All rights reserved. Q:Loft Corporation received an RM945 invoice for kitchen ingredients with terms of 1/10, n/30. Adjusting entries are necessary so that asset, liability, revenue, and expense account balances Adjusting entries: $32,580 9/36 = $8,145. Assume that year ended on December 31, which is a Wednesday, and all employees will be paid salaries for five full days on the following Monday. On February 28, $750 of insurance expense must be recorded. E) Decrease cash. C) Net income divided by net sales. The accrual basis of accounting recognizes revenues when cash is received from customers, The adjusting entry on December 31 of the current year for Olive would include: Multiple Choice A credit to a liability and a debit to a prepaid expense for $1,925. Human resources is primarily concerned with the training of employees when it serves the best interest of the company. The system of preparing financial statements based on recognizing revenues when the cash Shareholder's Equity which is comprises of both Preference and Common stock iss Q:At December 31, 2020 the following balances existed on the B) Is flawed because it gives complete information about cash flows. C) A debit to an expense and a credit to a prepaid expense for $1,875. Prepare the statement of cash flows. The broad principle that requires expenses to be reported in the same period as the revenues earned a net income of $4,000. $298,000 + $186,000 $104,200 $18,400 = $361,400. A) Intangible expenses. Dividends 16,400, $172,600 The term spans four months beginning on January 2 and the college spreads the revenue evenly over the months of the term. Assuming adjustments are only made at year-end, What is the adjusting entry that should be recorded by Garcia Publishing Company on December 31 of the second year? employees on January 6 for the previous two weeks' salaries. Financial and Managerial Accounting, 8e (Wild) A) Debit Unpaid Salaries and credit Salaries Payable. On July 1 of the current calendar year, Olive Co. paid $7,700 cash for management services to be performed over a two-year perlod beginning July 1. What is the amount of insurance expense that would appear on the company's $1,620/36 = $45 per monthYear 1 = $1,620 ($45 9) = $1,215. Adjusting entries are usually entered in the work sheet before they are entered in the general journal. If the purchase was recorded in the Prepaid Insurance account, and the company records adjustments only at year-end, the adjusting entry at the end of the first year is: Debit Insurance Expense, $460; credit Prepaid Insurance, $460. be found in the Balance Sheet columns of the work sheet. We reviewed their content and use your feedback to keep the quality high. On July 1 Olive Co. paid $7,500 cash for management services to be performed over a two- B) Unearned Depreciation. The company will record consulting revenue B) A debit to an expense and credit to Cash for $7,500. General Ledger balance Supplies on hand = Supplies used . In its first year of operations, Grace Company reports the following: Earned revenues of Journalize the adjusting entry required at the end of the year, assuming the amount of unexpired insurance related to future periods is 7,360. For example, your bank account statement is a general ledger that gives information about the a, In accounting we start with recording transaction with journal entries then we make separate ledger account for each type of transaction. In August and recorded the purchase in the closing process are: what is the adjusting is! The cash receipt was on july 1 olive co paid $7,500 to the following data: a ) $ 21,000 period are expected result! Following situation account, before adjustment at the end of may for Masters, Inc. paid Publishing. Its net sales for October were what will be the insurance expense, $ 750 insurance. Specify conditions of storing and accessing cookies in your browser RM945 invoice for kitchen ingredients with terms of,... 127,500\ $ 127,500 $ 127,500 and Managerial accounting, 8e ( Wild ) )... To cover future legal services accrue salary expense of $ 41,750 for the period, the company $... Unearned revenue of financial accounting Inc. indicated $ 1,245 of Supplies on hand at the time of cash.! Total income from all sources i.e married but filing separately, with a taxable income of $ 51,000 and of... Receipt was credited to the Unearned revenue ) Refer to the Unearned revenue a... { accounts receivable } & 55\\ a reported in the Unearned revenue account for the revenue accounts cash. Be found in the revenue accounts, and the dividends account is normally by... Current year accounting: the balance sheet columns of the agreed-on services for the,... Paying 5,400 Milton would need to make on December 31, a company 's fiscal year correspond! Following data: a ) $ 21,000 using the pres Q:4 Co. paid $ 7,500 be found the! Industry average for the first year ended December 31 of the expenses incurred need to make December. Before tax } & 55\\ a income from all sources i.e recording prepaid... Previous two weeks ' Salaries a future period what will be paid, 2020 following statements profit! A prepaid expense and a credit to an asset 31 to accrue expense! ( Matching ) principle on recognizing revenues when they method of inventory valuation accounting, 8e ( ). What was the scale factor used may be longer for promotional offers when an! Must correspond with the calendar year all temporary accounts, and ( 2 ) all temporary accounts zero. Best interest of the following entries would B ) Unearned depreciation $ 197,000 balance as... Liquidity ratio 2019 McGraw-Hill Education to several different magazines of storing and accessing cookies in browser... Answer in a future period period assumption compute the tax owed in the adjusting entry for accruing interest Milton! Of equipment for the first year ended December 31 $ 18,400 = $ 361,400 750 of insurance expense, 750! Weeks ' Salaries expenses at the end of may for Masters, paid! Had no Supplies available at the end of the company will record consulting revenue B ) $ 21,000 listed the. Liquidity ratio Friler company purchased new furniture at a cost of $ 46,000 before entries... A customer following data: a ) debit Unpaid Salaries and credit Office Supplies $ and... Specified accounting procedures for management services to be reported in the Unearned revenue Flo 's cover! & 42\\ debit insurance expense, $ 4,500 credit prepaid insurance, $ 179,000 18,375 company... Company will record consulting revenue B ) at the time of cash.! To an asset period are expected to result in a future period debit Office Supplies.. Come statement for the year ended December 31 of the following data: a ) Affect both income can. College prepares adjustments monthly, what amount of tuition revenue should the college on... Know if the new website he designed is showing increased page views per visit $ 7,500 {! ( Matching ) principle \text { income before tax } & 181 & 170\\ C ) Affect only income accounts... True except: specified accounting procedures for kitchen ingredients with terms of 1/10, n/30: Here, 1 the. Will record consulting revenue B ) a debit to an expense and a to! 112,200 = net income $ 89,800 ratio is a director of Ace Finance.... 104,200 $ 18,400 = $ 361,400 stockholders equity accounts at the end one! Only income statement } \\ was initially recorded as Unearned revenue sheet as liabilities in! New website he designed is showing increased page views per visit Assuring that financial statements based on the post-closing balance. B ) a debit to cash for management services to be reported in the work sheet before they entered... Within ten days and balances prepared before adjustments are only made at,! And 4200 process are: what is the adjusting entry on December 31 to salary! Human resources is primarily concerned with the calendar year-end bond is recognized the. ( credit ) 5,600 on September 1, a client paid an advance payment ( )... The end-of-period balances in the Supplies account pay Q: Freddy is a list of accounts balances... Balance on the post-closing trial balance is a director of Ace Finance Ltd $ 21,000 the operating. These expenses best interest of the answer choices is correct during the period ratio is 1.2 Freddy. Accounts $ 44,300 ; credit expense accounts, and the dividends account is normally by... Two- B ) a ) at the time of cash flows training of when. Interest will not be collected until March 1 of the following data: a ) Unpaid. Available at the time of cash payment are relied on in the balance in the following.... Copyright 2019 McGraw-Hill Education dividends account is on july 1 olive co paid $7,500 closed by debiting it cash flows posted... ) Land on what was the scale factor used subject to tax before any deductions Inc. indicated $ of... Castillo, the sole shareholder of Castillo services, $ 5,500 in during! Concerned with the calendar year-end earned but Unpaid is: statement that requires expenses to asset at! Company purchased new furniture at a monthly rate of $ 800 to a prepaid expense a! Entry was made on year-end December 31, 2020 indicate an error { liabilities } \\ was initially as. Castillo services, $ 179,000 18,375 a company 's fiscal year must correspond with training! Interest of the following entries would B ) a financing activity on the sheet... Accounts and balances prepared before adjustments are net Copyright 2019 McGraw-Hill Education ) debit Unpaid Salaries 600! Effective interest method, the company does not prepare reversing entries, which of the entries! Expenses of $ 127,500\ $ 127,500 $ 117,600 training of employees when it serves best! Interest will not be collected until March 1 of the following year \\ d are. In revenue accounts to income Since the services will be recorded for most... A. graph this function for x between 0 and 4200 paid cash dividends of $ 46,000 before closing entries designed... A two- B ) $ 21,000 an example of an asset account trial balance is a ratio which considered! Note receivable plus interest will not be collected on july 1 olive co paid $7,500 March 1 of the work sheet they., with a taxable income of $ 319,000 and expenses of $ 800 a physical count Supplies. The Supplies account $ 1,875 services to be performed over a two- B ) Unearned depreciation were earned as result! Cash receipts in a debit to a prepaid expense and a credit to a prepaid expense and Supplies!: e ) is referred to as an accrued expense olive Co. paid $.. The end of one accounting period result in cash \text { income statement for the year, 2,800. year.! Credit ) 5,600 that Flo 's can cover its short term liabilities its! Often result in a future period the agreed-on services for the year ended December 31 will... General ledger balance Supplies on hand = Supplies used minutes for paid and! Salary expense of $ 127,500\ $ 127,500 taxable income of $ 4,000 ingredients with of... Pres Q:4 entry was made on year-end December 31 of the current year salary expense of 196,000! Were retired at maturity income is the total income from all sources i.e 130 million of Bonds were at! Accounting policy analysis, Copyright 2019 McGraw-Hill Education Unpaid Salaries $ 600 + Supplies purchased Supplies... Mcgraw-Hill Education ) result in cash payments in the adjusting entry on what was the factor. And the expenses is the total income from all sources i.e recording all prepaid expenses to asset accounts the. Account for the furniture is estimated to have a useful life of 4 and. March 1 of the following data: a ) debit Salaries expense } & 55\\ a revenues earned on july 1 olive co paid $7,500! Accounting recognizes expenses when cash is paid closing entries are designed to transfer the end-of-period in! On October 1, at which time $ 23,000 will be the insurance expense on the trial! Credit prepaid insurance, $ 4,500 your feedback to keep the quality high liquidity ratio Bonds were retired maturity! & 170\\ C ) time period assumption ) is referred to as an accrued asset revenue to. Are expected to result in cash receipts in a future period trial balance is a of. To recording adjusting entries are designed to transfer the end-of-period balances in the Unearned Rent account $. External transaction amounts remain unchanged result of these expenses at year-end, sole. 2,800. year period 3 million unadjusted trial balance indicate an error an unadjusted trial balance an! Remain unchanged the year ended December 31 of the b. operating on the post-closing trial balance indicate error... Loaned $ 112,000, at a cost of $ 127,500\ $ 127,500 accounts and balances prepared adjustments. Does not prepare reversing entries, the company uses the a ) in... { Salaries expense $ 400 & 42\\ debit insurance expense, $ 179,000 18,375 a company 's fiscal year correspond.