Question

1. On the “AJE” worksheet, prepare the adjusting journal entries in good form for the following items. Identify each entry by letter in Column B. Round all answers to the nearest dollar. You may omit explanations. Leave a blank row between each journal entry. All the accounts you need are given on the worksheet. Use only these accounts, written exactly as presented on the worksheet. (Hint: use cell references.) Prepare journal entries and financial statements for the year ended December 31, 2019. No adjusting entries have been made since December 31, 2018.

a. Grizzlies, Inc. borrowed money by issuing a nine-month, $12,000, 8.0% note on October 1, 2019 with interest and principal to be paid on maturity.

b. On November 1, 2019, Grizzlies, Inc. rented storage space at a cost of $800 per month. On that date Grizzlies, Inc. recorded Prepaid Rent for five months’ rent paid in advance.

c. Grizzlies, Inc. recorded the purchase of $4,400 of shop supplies during the year by increasing the Shop Supplies account. A physical count of the shop supplies on December 31, 2019, shows $3,300 in shop supplies on hand.

d. Store supplies totaling $15,200 were purchased during the year and were immediately recorded as an expense. A physical count of the store supplies on hand December 31, 2019, indicates a balance of $2,500.

e. On April 1, 2019, Grizzlies, Inc. purchased a 24-month insurance policy for $12,800.

f. On July 1, 2019, Grizzlies, Inc. collected $16,000 for consulting services to be performed from July 1, 2019 to February 28, 2020. The company credited the Unearned Consulting Revenue account when paid.

g. Grizzlies, Inc. rented idle office space to Squirrels, Inc. on February 1, 2019, at a rate of $1,200 per month. On this date Grizzlies, Inc. credited Unearned Rent Revenue for one year of rent received in advance.

h. Grizzlies, Inc. is open five days a week and has a daily payroll of $4,400. Employees are paid every Friday. Assume December 31 is a Wednesday. The payroll is allocated as follows: 25% of the payroll relates to office employees, and the balance relates to sales employees.

i. Depreciation for store equipment has been calculated to be $1,200 per month.

j. Depreciation for office equipment has been calculated to be $800 per month.

k. Utilities expenses of $1,100 were incurred, but not yet recorded. Utilities expense is allocated as follows: 10% relates to the office and the balance relates to the store.

**Please note: The Adjusted Journal Entry column balance should be 73,440 after entries are all made and should balance on both the debit and credit side of the entries**

Answer 1