Adjusting Entries Judy Brock began Brock Refinishing Service on July 1. Selected accounts are shown below as of July 31, before any adjusting entries have been made:
Debit | Credit | |
---|---|---|
Prepaid rent | $5,700 | |
Prepaid advertising | 930 | |
Supplies | 3,000 | |
Unearned refinishing fees | 900 | |
Refinishing fees revenue | 2,500 |
Monthly financial statements are prepared. Using the following information, record in a general journal the adjusting entries necessary on July 31:
a. On July 1, the firm paid one year's rent of $5,700.
b. On July 1, $930 was paid to a local newspaper for an advertisement to run daily for the months of July, August and September.
c. Supplies of $1,100 were on hand July 31.
d. At July 31, refinishing services of $975 have been performed but not yet billed to customers. The firm uses the account Fees Receivable to reflect amounts due but not billed.
e. One customer paid $900 in advance for a refinishing project. At July 31, the project is one-half complete.
Round your answers to the nearest dollar.
Adjusting entry :
Date | account and explanation | debit | credit |
July 31 | Rent expense (5700/12) | 475 | |
Prepaid rent | 475 | ||
(To record rent expense) | |||
July 31 | Advertising expense (930/3) | 310 | |
Prepaid advertising | 310 | ||
(To record advertising expense) | |||
July 31 | Supplies expense (3000-1100) | 1900 | |
Supplies | 1900 | ||
(To record supplies adjusted) | |||
July 31 | account Fees Receivable | 975 | |
Refinishing fees revenue | 975 | ||
(To record accured revenue) | |||
July 31 | Unearned refinishing fees (900/2) | 450 | |
refinishing fees Revenue | 450 | ||
(To record revenue) | |||
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