Question

4. The trial balance of Swift Company shows the following balances for selected accounts on November...

4.

The trial balance of Swift Company shows the following balances for selected accounts on November 30, 2006:

Prepaid Insurance

$ 5,000

Unearned Revenue

$ 1,800

Equipment

40,000

Notes Payable

24,000

Accumulated Depreciation

8,800

Interest Payable

400

Instructions

Using the additional information given below, prepare the appropriate monthly adjusting entries at November 30. Show computations.

A. Revenue earned for services rendered to customers, but not yet billed, totaled $4,000 on November 30.

B. The note payable is a 7%, 1-year note issued October 1, 2006.

C. The equipment was purchased on January 2, 2004, for $50,000. It has an estimated life of 4 years and an estimated salvage value of $2,000. Swift uses the straight-line depreciation method.

D. An insurance policy was acquired on June 30, 2006; the premium paid for 2 years was $12,000.

E. Smart received $1,800 of revenue in advance from a customer on November 1, 2005. Two-thirds of this amount was earned by November 30.

please show work
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