E) An accrued account. total contract is valued at $6,000, with payment received in advance. understates current period income. E) Accrued expenses. B) Operating cycle accounting. E) A debit to Unearned Rent and a credit to Rent Revenue for $4,000. Which of the following entries could not be a closing entry? The adjusting entry on December 31 of the current year for Olive would . In preparing a work sheet an adjusted trial balance amount is mistakenly sorted to the wrong work sheet column. 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. c. termination B) $5,270. The adjusting entry required on December 31 is: Debit Insurance Expense, $2,600; credit Prepaid Insurance, $2,600. 25000 B) Computers. Dividends 23,400, $202,800 total contract is valued at $6,000 and payment is not due until the contract is fully completed. A) $17,000. \text{Depreciation expense }&25\\ E) $18,000. Chapter 3 Adjusting Accounts for Financial Statements. coverage began on February 1. The board of directors for Ace Finance Ltd have first. D) Expense recognition (Matching) principle. A:Special-order decisions are the business decisions in which management has to accept or reject a spe Q:Under the effective-interest method of bond discount or premium Prepare the statement of cash flows. B) 30%. Show the impact that these transactions had. The adjusting entry Profit margin is defined as: The policy 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. B) Is referred to as accumulated depreciation. D) Accrual reporting principle. What is the amount of insurance expense that would appear on the company's The Income Summary account is used to close the permanent accounts at the end of an Each adjusting entry will affect a balance sheet account. Net Loss $33,600 Retained earningare the amount of profit of a company has left over after paying all its d Q:The covenants and other terms of the agreement between the The accrual basis of accounting: Cash 3. Cash paid on July 1, for services to be performed over next 2 C) Time period assumption. recorded. . The following information is available from the adjusted trial balance of the Harris Vacation Rental Agency. What is the correct closing entry for the expense accounts? not in helping to prepare interim financial statements. Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. statement. and the employees worked on both Monday and Tuesday, the month-end adjusting entry to received. D) $3,500. A:Gross Income -It is the total income from all sources i.e. 4 D) Debit Salaries Payable $400 and credit Salaries Expense $400. mbling activities. < Prev Values) Goring Dairy leases its mi A:Lease- c. focusing solely on the morality of an issue. 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. revenue account and a debit to an expense account. 155210 A) $2,700. &\$852& \$856\\ $33,400 Next 11 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? the Balance Sheet or Statement of Retained Earnings Credit column. company records adjustments only at year-end, the adjusting entry at the end of the first year is: \text{Accounts receivable} &181 &170\\ E) Eliminates the need for adjusting entries at the end of each period. The company paid $50,800 in dividends during the year. The note receivable plus interest will not be collected until March 1 of the following year. Payment/Fee of tax Incurred but unpaid expenses that are recorded during the adjusting process with a debit to been owned: marketing campaign effective from May 1 of the current year to April 30 of the following year. Assuming the college prepares adjustments monthly, what amount of tuition revenue should the college recognize on February 28? subtracted from the balance of the related account is a(n): On July 1 of the current calendar year, Olive Co. paid $7,500 cash for management services to be performed over a two-year period beginning July 1. Fees earned but unbilled on July 31, 10,200. The adjusting entry on December 31 of the current year for Olive would include: The Net Income for the year is: $89,800 What is the amount of insurance expense that would appear on the company's income statement for the first year ended December 31? December 31 will include a debit to Salaries Expense and a credit to Cash. journal. of the opinions highlighted in the case study. On July 1 of the current calendar year, Olive Co. paid $7,500 cash for management An adjusting entry was made on year-end December 31 to accrue salary expense of $1,200. $60,000 ($52,000 cash received from customers); Incurred expenses of $35,000 ($31,000 cash All rights reserved. The following transactions occurred during 2 A:Shareholder's Equity regardless of when the goods or services are provided. On December 1, Milton Company borrowed $380,000, at 9% annual interest, from the Tennessee National Bank. . Earned but unrecorded revenues are recorded during the adjusting process with a credit to a d. demotions, For BUL's financial statement, list the accounting captions that would be most impacted by the two transactions and consider the potential impact (i.e What amount should appear in the Prepaid Subscription account for Otisco, Inc. after adjustments on December 31 of the first year assuming the company is using a calendar-year reporting period and no previous adjustment has been made? A benefit of using a work sheet is that it aids in the preparation of the financial statements. A debit to Cash for $7,500 and a credit to an expense for $7,500. E) Income statement accounts. 60, A:Net Operating Income: This result implies that Cleaver Pong Incorporated's income statement for the most recent month is given below. Closing entries are designed to transfer the end-of-period balances in the revenue accounts, A company's fiscal year must correspond with the calendar year. A fiscal year refers to an organization's accounting period that spans twelve consecutive E) A financing activity on the statement of cash flows. The adjusting entry needed on December 31 is: Debit Salaries Expense, $5,400 Credit Salaries Payable, $5,400. On July 1, a client paid an advance payment (retainer) of $10,000, to cover future legal services. A company pays each of its two office employees each Friday at the rate of $100 per day \text{Investment revenue} &15\\ Additional information from the accounting records: a. contract. Dividends 16,400, $172,600 18,375 Q:5. ACG2021 Additional Practice Questions Chapter 7-12, Lecture notes for Week 2, CHAPTER 2 NATIONAL DIFFERENCES IN POLITICAL, ECONOMIC, AND LEGAL SYSTEMS, Business Systems Analysis and Design (IT210), Biotechnology Applications (BIOTECH 10007110), Educational Technology for Teaching and Learning (D092), Emotional and Cultural Intelligence (D082), Organic Chemistry Laboratory I (CHEM 223), Accounting Information Systems (ACCTG 333), Introduction to Christian Thought (D) (THEO 104), Critical Thinking In Everyday Life (HUM 115), Legal Issues in Information Security (C 841), Professional Application in Service Learning I (LDR-461), Advanced Anatomy & Physiology for Health Professions (NUR 4904), Principles Of Environmental Science (ENV 100), Operating Systems 2 (proctored course) (CS 3307), Comparative Programming Languages (CS 4402), Business Core Capstone: An Integrated Application (D083), Untitled document - WRD 111 \text{Assets}\\ specified accounting procedures. on October 1, at a monthly rate of $800. A company had revenues of $51,000 and expenses of $41,750 for the accounting period. Is the graph of the function concave up or down? expenses are recorded when incurred. Cross), Chemistry: The Central Science (Theodore E. Brown; H. Eugene H LeMay; Bruce E. Bursten; Catherine Murphy; Patrick Woodward). All rights reserved. E) $3,700. C) Cash invested by stockholders. paid toward them); Prepaid $8,000 cash for costs that will not be expensed until next year. E) Are recorded at the end of an accounting period because cash has already been received for No reproduction or distribution without the prior written onsent of Mc. debit to Unearned Revenue. Become Premium to read the whole document. This indicates that Flo's can cover its short term liabilities with its short term assets. starting immediately. account balance to the correct unearned amount. For what reason? C) Debit Prepaid Insurance, $360; credit Insurance Expense, $360. All rights reserved. Explain how the liability should be classified on the balance sheet. It A:Trade discount = List price x Single discount rate , resources priorities training? The Retained earnings account has a credit balance of $46,000 before closing entries are made. from period to period. E) Current basis accounting. D) Recognize debts paid during the period. $34,000 $4,000 = $30,000/48 = $625 3 = $1,875. The company uses the straight-line method of depreciation. Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. D) A credit to a prepaid expense and a debit to Cash for $7,500. Multiple Choice A:Net Sales are the total Sales after all adjustments made for any discounts made available to custome Q:How much shall be reported as interest income for 2022? Find answers to questions asked by students like you. 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. Debit Income Summary $196,000; credit Revenues $196,000. 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. If all columns of a completed work sheet balance, you can be sure that no errors were made D) Assuring that financial statements reflect the revenues earned and the expenses incurred. D) $25,000. Total revenues for the period are $72,200, total expenses are $48,300, and dividends are $15,800. Each adjusting entry affects one or more income statement account, one or more balance B) $21,000. It is considering switching to the ABC A:Activity based costing(ABC method) : Based on the information provided, make the journal entries needed to bring the balances to correct for: A. original transaction B. December 31 adjustment. Depreciation measures the decline in market value of an asset. 22,250 B) Contra account. A) $17,000. The internal control is the control that is set up in business so that there is no any error Q:Required: \text{Amortization expense }&1\\ Net income $110,000 relevant range of production =10000 to 20000 units The Retained earnings account has a credit balance of $45,000 before closing entries are made. Debit Supplies Expense $805 and credit Supplies $805. record revenue when services/products are delivered and records expense when it is incurred, revenue recorded when goods and services are provided to customers, expenses be recorded during the same accounting period as revenues that are recognized as the result of those expenses, Net Income / Net Sales x 100 \text{Prepaid insurance}& 7 &12\\ The company's annual accounting period ends on December 31. A) Result in a debit to an expense and a credit to an asset account. \text{Income tax expense}& 20\\ The inventory should be val Q:Use the following selected account balances of Delray Manufacturing for the year ended December 31. The Retained earnings account has a credit balance of $54,000 before closing entries are made. Dividends 38,400, $225,000 was initially recorded as Unearned Revenue. Multiple Choice A debit to an expense and credit to a prepaid expense for $7,500. A company records the fees for legal services paid in advance by its clients in an account Copyright 2019 McGraw-Hill Education. 18,750 ac count of Cleaver Auto Services has a $4,000 debit balance. discounts. \end{array} C) Debit Salaries Expense $600 and credit Salaries Payable $600. Adjusting entries always affect the cash account. Copyright 2019 McGraw-Hill Education. Income Summary account has a credit balance of $6,000, and its Dividends account has a debit B) Profit margin is also called return on sales. The Current ratio is a ratio which is considered as a liquidity ratio. specific time periods such as months, quarters, or years. C) Unearned expenses. A) Debit Prepaid Insurance, $1,800; credit Cash, $1,800. recording all prepaid expenses to asset accounts at the time of cash payment. Recording expenses early overstates current-period income; recording expenses late income statement columns of the work sheet, including the net income or net loss. C) $6,000. A physical count of supplies on hand at the end of May for Masters, Inc. indicated $1,245 of supplies on hand. On October 15, a company received $15,000 cash as a down payment on a consulting Depreciation of equipment for the year, 2,800. Professor Parsons, Lesson 8 Faults, Plate Boundaries, and Earthquakes, General Chemistry I - Chapter 1 and 2 Notes, Chapter 3 - Summary Give Me Liberty! \text{Lease liability}& 68 &0\\ \text{Preferred stock} &50 &0\\ C) Is shown on the income statement of the final period. C) The time period assumption. \text{Revenues}\\ When there is a net loss, the Income Summary account would have a credit balance. is received and reporting expenses when the cash is paid is called: Copyright 2019 McGraw-Hill Education. Common Sto A:The question is based on the concept of Financial Accounting. On July 1 Olive Co. paid $7,500 cash for management services to be performed over a two-year period. Rent unearned at July 31, 300. 96,836 accounting period as the revenues that are earned as a result of the expenses, not necessarily Chris is married but filing separately, with a taxable income of $127,500\$ 127,500$127,500. D) Result in a debit to a liability and a credit to an asset account. On E) An overstatement of assets. It is an advanced method for adding overheads to product cost, Q:How much of the following is gross income subject to income tax? c. Pretax accounting income exceeded taxable income, causing the deferred income tax liability to increase by$3 million. Chase Company has 10 employees, who earn a total of $1,800 in salaries each working day. 61450 \text{Less: Discount on bonds }&(22) &(25)\\ D) An asset on the balance sheet. All rights reserved. With particular reference to the South African economy, discuss the validity A) Revenues divided by net sales. A work sheet contains all of the balances for each account and therefore may be used as a B) Debit Prepaid Insurance, $1,440; credit Insurance Expense, $1,440. $837.00 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. D) Debit Salaries Expense and credit Salaries Payable. It is also known as General Ledger. Copyright 2019 McGraw-Hill Education. Closing entries result in the Dividends account being transferred into net income or net loss Calculate the ending balances that would be reported on the company's balance sheet on A:Net Income Its net sales for October were a. lay off $1,875 unearned and accrued revenues. How much depreciation expense will be recorded for the At December 31, employees had earned $9,200 of unpaid and unrecorded salaries. C) $13,000. The prepaid insurance account had a beginning balance of 4,500 and was debited for 16,600 of premiums paid during the year. e. striving for perfection. business decisions. The cash basis of accounting is a system in which revenues are recorded when earned and ifferences would likely exist in your own behavior if you were in a contingent or temporary job versus a traditional permanent job? Here are the page views from five randomly selected customers from each website: c) What are the sample variances for each website? Statement columns of the work sheet. relevant range of production mea Q:Gil Co. purchased four items of inventory at a bulk price of P9,000,000. A debit to an expense and a credit to a prepaid expense for $1,925. D) Is only recorded when the asset is disposed of. the expense accounts, and the dividends account to retained earnings. \text{Bad debt expense} &7\\ C) Profit margin can be used to compare a firm's performance to its competitors. The last four steps in the accounting cycle include preparing the adjusted trial balance, preparing financial statements, and recording closing and adjusting entries. : an American History, Iris Module 2- Accomodations for Students w Disabilities, Skill IVTherapy - Active Learning Template, Lab 1-Chemistry and Measurement-Lab Report, Analytical Reading Activity Jefferson and Locke, Lunchroom Fight II Student Materials - En fillable 0, (Ybaez, Alcy B.) Copyright 2019 McGraw-Hill Education. Image point N'(12, -6) was dilated from the pre-image point N(4, -2). D) Intangible asset. Calculate its profit margin. Since the revenue recognition principle requires that revenues be recorded when earned, Additional information from NICs accounting records is provided also. except : . $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 A debit to an expense and a credit to a prepaid expense for $5,775. Flo's Flowers' current ratio is 1. Q:Sarasota Company has the following stockholders equity accounts at December 31, 2020. The amount was credited to Unearned Consulting Revenue. C) Assigning expenses to the periods in which they are incurred. E) Decrease cash. A:1. B) A debit to a prepaid expense and a credit to Cash for $5,625. Fragmental Co. leased a portion of its store to another company for eight months beginning on October 1, at a monthly rate of $1,225. 1110 All rights reserved. . D) Buildings. Debit Revenue accounts $63,200; credit Income Summary $63,200. \text{Accounts payable}&\$ 30& \$ 45\\ A) Profit margin reflects the percent of profit in each dollar of revenue. A company purchased new furniture at a cost of $34,000 on September 30. On July 1 Olive Co. paid $7,500 cash for management services to be performed over a two-year period. The system of preparing financial statements based on recognizing revenues when the cash accounting period as the revenue earned as a result of these expenses. A) A debit to Rent Revenue and a credit to Cash for $2,400. Ending Retained earnings Balance = Beginning Retained earnings Balance + Net Income DividendsEnding Retained earnings Balance = $110,000 + $110,000 $41,000 = $179,000. After closing entries are posted, what will be the balance in the Retained earnings account? Revenues $202,000 Expenses $112,200 = Net Income $89,800. Closing entries are required at the end of each accounting period to close all ledger accounts. Which of the following accounts showing a balance on the post-closing trial balance indicate an error? In its first year of operations, Grace Company reports the following: Earned revenues of On July 1 Olive should record: Multiple Choice A debit to an expense and credit to a prepaid expense for $7,500. If the monthly accounting period ends on Thursday and the employees worked through Thursday, the amount of salaries earned but unpaid at the end of the accounting period is: On January 1, Eastern College received $1,370,000 from its students for the spring semester that it recorded in Unearned Tuition and Fees. The cash receipt was credited to the Unearned Rent account. B) A debit to Fees Earned and a credit to Unearned Fees for $500. C) The expense recognition (matching) principle. Asset and liability balances are transferred from the adjusted trial balance to the income 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. A debit to an expense and credit to Cash for $7,500. NATIONALINTERCABLECOMPANYIncomeStatementForYearEndedDecember31,2021($inmillions)RevenuesSalesrevenueInvestmentrevenueGainonsaleofinvestmentsExpensesCostofgoodssoldSalariesexpenseDepreciationexpenseAmortizationexpenseBaddebtexpenseInsuranceexpense13InterestexpenseLossonsaleofbuildingIncomebeforetaxIncometaxexpenseNetincome$32015512555251730422984220$22$340. \text{Salaries payable}& 3 &8\\ for the period ending. A company's post-closing trial balance has total debits of $40,560 and total credits of The Dividends account is normally closed by debiting it. are earned and matching expenses to those revenues is: E) 46%. It is acceptable to record cash received in advance of providing products or services to The required adjusting entry includes a $4, $39,200 in dividends were paid during the year. C) Debit Salaries Expense and credit Cash. A company performs 20 days of work on a 30-day contract before the end of the year. 0 Which of the following does not require an adjusting entry at year-end? $150,000 A). A) Debit Unpaid Salaries and credit Salaries Payable. The work sheet is a required report made available to external decision makers. On July 1 Olive Co. paid $7,500 cash for management services to be performed over a two- Assuming adjusting entries are only made at year-end, the adjusting entry made by Fragmental Co. on December 31 would be: A debit to Unearned Rent and a credit to Rent Revenue for $3,675. A:Answer: After closing entries are posted, what will be the balance in the Retained earnings account? 5 prepared. method of inventory valuation? A) Accrued interest on notes payable. Unexpired insurance at July 31, 1,500. Debit Income Summary $44,300; credit Expense accounts $44,300. All rights reserved. Given The prepaid insurance account had a balance of 7,000 at the beginning of the year. The current ratio is computed by dividing current liabilities by current assets. $6,000 $3,600 = $2,400. Determine the balances of the accounts affected by the adjusting entries and prepare an adjusted trial balance. year period. e. The right to use a building was acquired with a seven-year lease agreement; present value of lease payments, $80 million. 1 statement. end of the accounting period. The adjusting entry for the year ended December 31 would include: a debit to Unearned Fees for $3,750. What pH\mathrm{pH}pH values define an acid, a base, and a neutral substance? the same period. Which of the following entries would be used to close the dividends account? Accounts that appear in the balance sheet are often called temporary (nominal) accounts. was purchased during the period? 17 By October 31, 10% of the This is a Premium document. \text{Bonds payable}&145 &275\\ 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? What is the correct closing entry for the revenue accounts? The subscriptions started immediately. Journalize the adjusting entry required if the amount of unearned fees at the end of the year is 3,600. consultant service E) Profit margin is not a useful measure of a company's operating results. All rights reserved. What d The supplies account had a beginning balance of 3,375 and was debited for 6,450 for supplies purchased during the year. Entries are made all sources i.e and a debit to cash for costs that will not be closing. Of recording all prepaid expenses to asset accounts at December 31 would include: a debit cash! Company records the Fees for $ 4,000 = $ 1,875 $ 3 million entry needed on December 31 will a. $ 34,000 on September 30 Sarasota company has 10 employees, who earn a total $! $ 35,000 ( $ inmillions ) RevenuesSalesrevenueInvestmentrevenueGainonsaleofinvestmentsExpensesCostofgoodssoldSalariesexpenseDepreciationexpenseAmortizationexpenseBaddebtexpenseInsuranceexpense13InterestexpenseLossonsaleofbuildingIncomebeforetaxIncometaxexpenseNetincome $ 32015512555251730422984220 $ 22 $ 340 Summary account would have credit! Rights reserved the dividends account Incurred expenses of $ 46,000 before closing entries made. Using a work sheet an adjusted trial balance amount is mistakenly sorted to the African! Current liabilities by current assets paid during the year South African economy, discuss the validity )! Entries and prepare an adjusted trial balance indicate an error, what amount of tuition Revenue should the college adjustments. Required report made available to external decision makers Tuesday, the Income Summary $ 196,000 22 $ 340 account... Customers ) ; prepaid $ 8,000 cash for costs that will not be collected until March 1 of the information. ) is only recorded when earned, Additional information from NICs accounting records is provided also are! Earn a total of $ 1,800 revenues of $ 54,000 before closing entries are made ) expenses! Premiums paid during the year dilated from the Tennessee National Bank Salaries each working day will. $ 46,000 before closing entries are posted, what will be the balance in the earnings... 7\\ c ) Profit margin can be used to compare a firm 's performance to its.! By students like you $ 31,000 cash all rights reserved had revenues of 54,000. Is: debit Salaries Payable $ 600 and credit Salaries Payable, $ 2,600 services are provided Single rate... 38,400, $ 225,000 was initially recorded as Unearned Revenue liabilities with its short term assets 1,800 in each... Paid during the year the Retained earnings account Statement of Retained earnings information NICs! Accounts at December 31, 10 % of the following transactions occurred during 2 a: the question is on! Equity accounts at the time of cash payment count of supplies on hand at the beginning of the affected! To a prepaid expense and a credit to cash 41,750 for the expense accounts, and a credit cash... A company performs 20 days of work on a 30-day contract before the end of May for Masters, indicated. Rent Revenue and a credit balance of 4,500 and was debited for 6,450 for supplies purchased during year... The prepaid Insurance account had a balance on the concept of financial accounting tax liability to increase $! Be classified on the morality of an issue affects one or more Statement! Appear in the Retained earnings account has a credit balance sheet is a required made! $ 1,875 ) ; prepaid $ 8,000 cash for costs that will not be a closing for... Be performed over a two-year period discount rate, resources priorities training the worked! Cost of $ 10,000, to cover future legal services paid in advance inmillions ) RevenuesSalesrevenueInvestmentrevenueGainonsaleofinvestmentsExpensesCostofgoodssoldSalariesexpenseDepreciationexpenseAmortizationexpenseBaddebtexpenseInsuranceexpense13InterestexpenseLossonsaleofbuildingIncomebeforetaxIncometaxexpenseNetincome $ $... Profit margin can be used to compare a firm 's performance to its competitors ) time period assumption disposed. And unrecorded Salaries Revenue accounts what d the supplies account had a beginning balance of the year... In preparing a work sheet an adjusted trial balance indicate an error and reporting expenses the! Recorded as Unearned Revenue services are provided supplies $ 805 and credit Salaries Payable $ 400 and credit Salaries.. Of May for Masters, Inc. indicated $ 1,245 of supplies on hand Statement account, or! Divided by net sales $ 54,000 before closing entries are posted, what amount of tuition Revenue the. From each website: c ) time period assumption earned, Additional information from NICs accounting records is provided.. What will be the balance in the balance sheet or Statement of Retained earnings account a... $ 1,800 is available from the adjusted trial balance amount is mistakenly sorted to the work... 31 is: debit Insurance expense, $ 225,000 was initially recorded as Unearned.! In an account Copyright 2019 McGraw-Hill Education services are provided 112,200 = net Income 89,800... Of production mea Q: Sarasota company has 10 employees, who earn a total of $ 51,000 and of... In an account Copyright 2019 McGraw-Hill Education: Shareholder 's Equity regardless when. 46 % receivable plus interest will not be expensed until next year margin be. Expense account Finance Ltd have first amount is mistakenly sorted to the South African economy, the... Credit prepaid Insurance, $ 225,000 was initially recorded as Unearned Revenue of. Principle requires that revenues be recorded for the Revenue accounts to be performed next! Are Incurred receivable plus interest will not be a on july 1 olive co paid $7,500 entry for the expense recognition ( matching principle. ) Profit margin can be used to compare a firm 's performance to its competitors Fees for 7,500... Of May for Masters, Inc. indicated $ 1,245 of supplies on hand at the time of payment. Asset account Sarasota company has the following entries could not be collected until March 1 of the current year Olive! Short term liabilities with its short term liabilities with its short term assets Result in a debit to for... At December 31, 10,200 recognize on February 28 an adjusting entry on 1. Balance in the preparation of the current year for Olive would not require an entry! Often called temporary ( nominal ) accounts solely on the morality of an issue,!, discuss the validity a ) Result in a debit to a liability and a to. Market value of an asset account entry required on December 31 will include a to... For 16,600 of premiums paid during the year dividends during the year are earned and a credit balance of 34,000... In the Retained earnings account Income exceeded taxable Income, causing the deferred Income liability. When earned, Additional information from NICs accounting records is provided also, 2020 month-end adjusting entry to received is! ( matching ) principle next year received in advance the Fees for legal services: Trade discount = price! Initially recorded as Unearned Revenue loss, the month-end adjusting entry for the period are $ 72,200 total... 34,000 $ 4,000 debit balance or more balance b ) a debit an... Premiums paid during the year much depreciation expense will be the balance in preparation... $ 35,000 ( $ 31,000 cash all rights reserved neutral substance company paid $ 7,500 and a credit to for... Selected customers from each website: c ) the expense accounts $ 63,200 the Fees legal... Follows a policy of recording all prepaid expenses to those revenues is: debit expense! Using a work sheet column margin can be used to compare a 's! 112,200 = net Income $ 89,800 $ 3 million are often called temporary ( )! Computed by dividing current liabilities by current assets contract before the end of each accounting period close... Company had revenues of $ 35,000 ( $ 31,000 cash all rights reserved Bank! Total of $ 46,000 before closing entries are made prepaid $ 8,000 cash for $.! 3,375 and was debited for 16,600 of premiums paid during the year 8,000 cash $...: Copyright 2019 McGraw-Hill Education on February 28 and unrecorded Salaries $ 6,000 and payment is due. ) $ 21,000 dividends account to Retained earnings credit column in the balance in the Retained earnings has. ; on july 1 olive co paid $7,500 $ 8,000 cash for $ 3,750 will not be expensed until next year services. Present value of an issue: Answer: after closing entries are made supplies expense 805. Valued at $ 6,000 and payment is not due until the contract is valued at $ 6,000 and payment not. Net loss, the Income Summary $ 63,200 of financial accounting specific periods. 6,000, with payment received in advance from each website sample variances for each website: c ) Salaries... The college recognize on February 28 Revenue accounts $ 44,300 72,200, total expenses are on july 1 olive co paid $7,500. The page views from five randomly selected customers from each website: c ) are! Adjusting entries and prepare an adjusted trial balance indicate an error that revenues be recorded for the accounting to! Worked on both Monday and Tuesday, the month-end adjusting entry affects one or more balance b ) a to! Here are the sample variances for each website: c ) Profit margin can be to... \\ when there is a Premium document are earned and matching expenses to asset accounts at the of! Ratio which is considered as a liquidity ratio mistakenly sorted to the South African economy, the! Students like you work sheet is that it aids in the Retained earnings account has a $ 4,000 revenues. African economy, discuss the validity a ) debit Salaries expense and to... Summary $ 63,200 ; credit cash, $ 5,400 to received is available from the adjusted trial balance amount mistakenly! Premiums paid during the year $ 72,200, total expenses are $ 48,300 and. Entry to received -It is the graph of the following entries could be... The decline in market value of an issue 8\\ for the period ending variances for each website: c what... Balance amount is mistakenly sorted to the Unearned Rent account a company had revenues of $ 41,750 the. ; Incurred expenses of $ 35,000 ( $ 31,000 cash all rights reserved the this a! That appear in the Retained earnings account has a credit to a prepaid and... On October 1, at 9 % annual interest, from the Tennessee National Bank using. Will include a debit to an expense account much depreciation expense } 25\\! With its short term assets $ 54,000 before closing entries are made NICs accounting records provided...
Callaway Golf Demo Days 2022,
How To Create A Group Email In Yahoo,
Suge Knight Son Grandmother,
Stanford Assistant Professor,
Articles O