Question

Alfred hands you a pre-adjustment trial balance of an organisation known as Radcliffe Rifles and a series of notes about Radcliffe Rifles. He then asks you to undertake a series of tasks:

RADCLIFFE RIFLES

Pre-Adjustment Trial Balance as at 30 June 2020

Account	Debit	Credit
Accumulated Depreciation—Equipment		10 000
Advertising	1 700
Office Supplies	1 000
Bank	5 000
Capital—Blake		92 150
Cost of Sales	54 000
Accounts Payable		18 500
Customs Duty	3 000
Accounts Receivable	9 300
Delivery Expense	2 000
Discount Expense	2 100
Discount Revenue		3 200
Drawings	20 000
Equipment	90 000
Interest Expense	4 000
Loan—North Bank		40 000
Office Expenses	4 450
Prepaid Rent Expense	6 000
Sales		105 500
Inventory	47 800
Wages	19 000
Totals	269 350	269 350

The following transactions have not yet been entered in the accounts.

• Depreciation of equipment is to be charged at the rate of 1% per annum on cost.
• Prepaid Rent expired during the period $5600.
• A customer paid a deposit of $5000, inventory will be delivered on 5 July 2020.
• Wages owing at 30 June 2020 were $850.
• Accounts payable paid $12500.
• Prepaid annual insurance $1200, policy commencing from 1 July 2020.
• Accounts receivable collected 7500.
• On 30 June 2020 office supplies on hand $400.
• Radcliffe Rifles rented out the basement of the premises for $2000 per month. The tenant has not yet paid the June rent.
• Bad debt written off $500.

required

Mr Alfred instructs you to prepare the journal entries necessary to record above transactions in the General Journal as at 30 June 2020. Narrations are not required.   

Answer 1

Adjustment entries are the entries recorded by business to adjust the unpaid expenses or income as per accural concept of accounting.