Question 1

Black Company's unadjusted and adjusted trial balances on December 31 of the current year are as follows
  Present the four adjusting journal entries that were recorded by Black Company.

Accepted Answer

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Question 2

Day Co. leases an office to a tenant at the rate of $5,000 per month. The tenant contacted Day and arranged to pay the rent for December 2014 on January 8, 2015. Day agrees to this arrangement.
a. Prepare the journal entry that Day must make at December 31, 2014, to record the accrued rental revenue.
b. Prepare the journal entry to record the receipt of the rent on January 8, 2015.

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Question 3

Calculate the current ratio in each of the following separate cases.

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Question 4

On December 14 Bench Company received $3,700 cash for consulting services that will be performed in January. Bench records all such prepayments in a liability account. Prepare a general journal entry to record the $3,700 cash receipt.

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Question 5

The following information is available for the Wooden Company:
  From the information provided, calculate Wooden's profit margin ratio for each of the three years. Comment on the results, assuming that the industry average for the profit margin ratio is 6% for each of the three years.

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Question 6

On December 31, Connelly Company had performed $5,000 of management services for clients that had not yet been billed. Prepare Connelly's adjusting entry to record these fees earned.

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Question 7

Use the following information to prepare the adjusted trial balance for Bella's Beauty Salon. Bella's Beauty Salon's unadjusted trial balance for the current year follows:
  Additional information:
a. An insurance policy examination showed $1,240 of expired insurance.
b. An inventory count showed $210 of unused shop supplies still available.
c. Depreciation expense on shop equipment, $350.
d. Depreciation expense on the building, $2,220.
e. A beautician is behind on space rental payments and this $200 of accrued revenue was unrecorded at the time the trial balance was prepared..
f. $800 of the Unearned Rent account balance was earned by year-end.
g. The one employee, a receptionist, works a five-day workweek at $50 per day. The employee was paid last week but has worked four days this week for which she has not been paid.
h. Three months' property taxes, totaling $450, have accrued. This additional amount of property taxes expense has not been recorded.
i. One month's interest on the note payable, $600, has accrued but is unrecorded.

Accepted Answer

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Question 8

Prepare general journal entries on December 31 to record the following unrelated year-end adjustments.
a. Estimated depreciation on office equipment for the year, $4,000.
b. The Prepaid Insurance account has a $3,680 debit balance before adjustment. An examination of insurance policies shows $950 of insurance expired.
c. The Prepaid Insurance account has a $2,400 debit balance before adjustment. An examination of insurance policies shows $600 of unexpired insurance.
d. The company has three office employees who each earn $100 per day for a five-day workweek that ends on Friday. The employees were paid on Friday, December 26, and have worked full days on Monday, Tuesday, and Wednesday, December 29, 30, and 31.
e. On November 1, the company received six months' rent in advance from a tenant whose rent is $700 per month. The $4,200 was credited to the Unearned Rent account.
f. The company collects rent monthly from its tenants. One tenant whose rent is $750 per month has not paid his rent for December.

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Question 9

During the year, Able Co. purchased $23,750 worth of supplies, at the end of the year, the supplies expense on the adjusted trial balance was $29,340 and the balance sheet showed a balance of $810 in the supplies account. What was the supplies balance at the beginning of the year?

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Question 10

July 31, 2013, the end of the quarter is on a Wednesday. Employees get paid each Friday for the week worked. Abel Co. has five employees who earn $100 per day each. Assuming the proper adjusting journal entry was made on June 30, prepare the journal entry to record the payment of wages on August 2.

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Question 11

During the current year ended December 31, clients paid fees in advance for accounting services amounting to $25,000. These fees were recorded in an account called Unearned Accounting Fees. If $3,500 of these fees are still unearned on December 31 of this year, prepare the December 31 adjusting entry .

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Question 12

In general journal form, record the December 31 adjusting entries for the following transactions and events. Assume that December 31 is the end of the annual accounting period.
a. The Prepaid Insurance account shows a debit balance of $2,340, representing the cost of a three-year fire insurance policy that was purchased on October 1 of the current year.
b. The Office Supplies account has a debit balance of $400; a year-end inventory count reveals $80 of supplies still on hand.
c. On November 1 of the current year, Rent Earned was credited for $1,500. This amount represented the rent earned for a three-month period beginning November 1.
d. Estimated depreciation on office equipment is $600.
e. Accrued salaries amount to $400.

Accepted Answer

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Question 13

The following unadjusted and adjusted trial balances were taken from the current year's accounting system for High Point, Inc.
  In general journal form, present the six adjusting entries that explain the changes in the account balances from the unadjusted to the adjusted trial balance.

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Question 14

An asset that cost $50,000 was purchased on January 1. The asset has an estimated useful life of three years and an estimated salvage value of $3,200. Using the straight-line method, prepare the necessary adjusting journal entry for the end of the year.

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Question 15

Prepare an income statement from the adjusted trial balance of Hanson Storage.

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Question 16

Show the December 31 adjusting entry to record $750 of earned but unpaid salaries of employees at the end of the current accounting period.

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Question 17

July 31, 2013, the end of the quarter is on a Wednesday. Employees get paid each Friday for the week worked. Abel Co. has five employees who earn $100 per day each. Make the necessary adjusting journal entry for June 30.

Accepted Answer

Wages Payable……………………....$1,500
 5 * $100 * 3 days = 1,500

Question 18

______________________ are required at the end of the accounting period because certain internal transactions and events remain unrecorded.

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Question 19

Based on the adjusted trial balance, prepare a balance sheet for Martin Sky Taxi Services.

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Question 20

Shown below are selected data taken from the unadjusted and adjusted trial balances for the Simonson Company for the current year ended December 31. Determine the items A through H below.

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Quiz 3: Preparing Financial Statements

Black Company's unadjusted and adjusted trial balances on December 31 of the current year are as follows Present the four adjusting journal entries that were recorded by Black Company.