Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Accounting Basics Expert

Adjusting entries and financial statements. The following information pertains to Sally Corporation:
• The company previously collected $1,500 as an advance payment for services to be rendered in the future. By the end of December, one half of this amount had been earned.
• Sally Corporation provided $1,500 of services to Artech Corporation; no billing had been made by December 31.
• Salaries owed to employees at year-end amounted to $1,000.
• The Supplies account revealed a balance of $8,800, yet only $3,300 of supplies were actually on hand at the end of the period.
• The company paid $18,000 on October 1 of the current year to Vantage Property Management. The payment was for 6 months' rent of Sally Corporation's headquarters, beginning on November 1.
Sally Corporation's accounting year ends on December 31.
Instructions
Analyze the five preceding cases individually and determine the following:
a. The type of adjusting entry needed at year-end (Use the following codes: A, adjust¬ment of a prepaid expense; B, adjustment of an unearned revenue; C, adjustment to record an accrued expense; or D, adjustment to record an accrued revenue.)
b. The year-end journal entry to adjust the accounts
c. The income statement impact of each adjustment (e.g., increases total revenues by $500)
The company previously collected $1,500 as an advance payment for services to
be rendered in the future. By the end of December, one half of this amount had been
earned.
B, adjustment of an unearned revenue
Unearned service revenue
Debit $750
Service revenue
Credit
$750
Increase total revenue by $750
Sally Corporation provided $1,500 of services to Artech Corporation; no billing had
been made by December 31.
D, adjustment to record an accrued revenue.)
Accounts receivable
Debit $1,500
Service revenue
Credit
$1,500
Increase total revenue by $1,500
Salaries owed to employees at year-end amounted to $1,000.
C, adjustment to record an accrued expense
Salary expense
Debit $1,000
Salary Payable
Credit
$1,000
Increase total expense by $1,000
The Supplies account revealed a balance of $8,800, yet only $3,300 of supplies
were actually on hand at the end of the period.

A, adjustment of a prepaid expense
Supplies expense
Debit $5,500
Supplies
Credit
$5,500
Increase total expense by $5,500
The company paid $18,000 on October 1 of the current year to Vantage Property
Management. The payment was for 6 months rent of Sally Corporations
headquarters, beginning on November 1.
Sally Corporations accounting year ends on December 31.
A, adjustment of a prepaid expense
Rent expense
Debit $6,000
Prepaid Rent
Credit
$6,000
Increase total expense by $6,000

 

Accounting Basics, Accounting

  • Category:- Accounting Basics
  • Reference No.:- M942356

Have any Question? 


Related Questions in Accounting Basics

Auditing and professional practice assignmentcase study 1

Auditing and Professional Practice Assignment Case Study 1: Consider each of the following independent situations: (a) City Ltd, a property developer, has several major projects in progress in Brisbane's central business ...

Problem -using the following proforma information regarding

Problem - Using the following proforma information regarding GE, Inc. based on analysts' forecast in early 2016:   2016E 2017E Next 3 years EPS 1.29 1.56 Growth at 7.59% DPS 0.92 1.11 Growth at 10% The book value of GE's ...

This assignment will assess the following learning

This assignment will assess the following learning outcomes: - Demonstrate the impact on the financial statements and the implication for different users of accounts of alternative ways of treating controversial accounti ...

Assignmentfinal take home examination on basic erp

Assignment Final Take Home Examination on Basic ERP Configuration Concepts Provide brief but clear and specific answers to the following questions. Consult any sources necessary, including SAP's Help features. 1. What ar ...

Reflectionbulldescribe and explain what you believe are the

Reflection • Describe and explain what you believe are the top three most important corporate taxation concepts you learned in this course. (Some of the topics, Enacting New Taxes, Calculating Tax Cost, Cash Method Versu ...

Using what youve learned from this phase compare accrual

Using what you've learned from this phase, compare accrual accounting to cash flow accounting. Discuss the strengths as weaknesses of each. Consider how each accounting system impacts a company's strategy formation and t ...

Infrastructure and gasb statement1 answer the following

Infrastructure and GASB Statement 1. Answer the following questions with regard to infrastructure: A) What is infrastructure? B) What are two methods that might be used to record infrastructure expense from year to year? ...

Module 1 1 page topic selectionselect any topic in

Module 1 ( 1 Page ) Topic Selection Select any topic in accounting of interest that connects to the subject matter of this course. If you have already selected the area of your doctoral research, you may choose a topic i ...

Decide upon an initiative you want to implement that would

Decide upon an initiative you want to implement that would increase sales over the next five years, (for example, market another product, corporate expansion, and so on). Using the sample financial statements, create pro ...

Company name bhp billiton - report 2000-2200

Company Name BHP Billiton - Report (2000-2200) words Introduction Approach of research study What they have done wrong which results in the crisis Issues in sustainability report Issues in what they claim of doing but th ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

WalMart Identification of theory and critical discussion

Drawing on the prescribed text and/or relevant academic literature, produce a paper which discusses the nature of group

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro