You have been hired by Peters CAD, a small engineering and drafting firm, to help prepare a set of financial statements for the bank for the fiscal year ending October 31. You have reviewed all the transactions for the year and find the following information that has not been recorded in the company's books.
1) During October, Peters CAD provided $11,400 of CAD services to clients who will be billed in early November. The firm uses the account Fees Receivable to reflect amounts due but not yet billed.
2) The firm paid $14,400 cash on October 15 for a series of radio commercials to run during October and November. One-third of the commercials have aired by October 31st. The $14,400 payment was recorded in the Prepaid advertising account.
3) Starting October 1, all maintenance work on Peters CAD's computer and printing equipment is handled by PC Guru under an agreement whereby Peters CAD pays a fixed monthly charge of $4,800. Peters CAD paid six months' service charges of $28,800 cash in advance on October 1, and increased its Prepaid expenses account by $28,800.
4) Starting October 16, Peters CAD rented 800 square feet of storage space from a neighboring business. The monthly rent of $4.80 per square foot is due in advance on the first of each month. Nothing was paid in October, as the neighbor agreed that Peters CAD could pay the rent for October with the November 1 rent payment.
5) Peters CAD invested $60,000 cash in securities on October 1 (this part of the transaction was already properly recorded) and earned interest of $1,200 on these securities by October 31. No interest will be received until January.
6) Monthly depreciation on the equipment is $870. No depreciation has been recorded yet for the year.
7) Weekly salaries for a five-day week total $37,500, payable on Fridays. October 31 of the current year is a Tuesday.
8) A bill for work done during August and September has not yet been sent because the client is out of the country. The bill totals $12,450.
9) Peters CAD has $240,000 of notes payable outstanding at October 31(already recorded on the books). Interest of $2,400 has accrued on these notes by October 31, and will be paid when the notes mature in 2020.
10) Peters CAD received a $12,000 deposit in June from a client for a job to be completed by the end of the fiscal year (this part of the transaction was already properly recorded). Peters CAD completed the job on October 31.
Required: Prepare accounting adjustments required at October 31 using the financial statement effects template that follows

Question

You have been hired by Peters CAD, a small engineering and drafting firm, to help prepare a set of financial statements for the bank for the fiscal year ending October 31. You have reviewed all the transactions for the year and find the following information that has not been recorded in the company's books. 
1) During October, Peters CAD provided $11,400 of CAD services to clients who will be billed in early November. The firm uses the account Fees Receivable to reflect amounts due but not yet billed.
2) The firm paid $14,400 cash on October 15 for a series of radio commercials to run during October and November. One-third of the commercials have aired by October 31st. The $14,400 payment was recorded in the Prepaid advertising account.
3) Starting October 1, all maintenance work on Peters CAD's computer and printing equipment is handled by PC Guru under an agreement whereby Peters CAD pays a fixed monthly charge of $4,800. Peters CAD paid six months' service charges of $28,800 cash in advance on October 1, and increased its Prepaid expenses account by $28,800.
4) Starting October 16, Peters CAD rented 800 square feet of storage space from a neighboring business. The monthly rent of $4.80 per square foot is due in advance on the first of each month. Nothing was paid in October, as the neighbor agreed that Peters CAD could pay the rent for October with the November 1 rent payment.
5) Peters CAD invested $60,000 cash in securities on October 1 (this part of the transaction was already properly recorded) and earned interest of $1,200 on these securities by October 31. No interest will be received until January.
6) Monthly depreciation on the equipment is $870. No depreciation has been recorded yet for the year.
7) Weekly salaries for a five-day week total $37,500, payable on Fridays. October 31 of the current year is a Tuesday.
8) A bill for work done during August and September has not yet been sent because the client is out of the country. The bill totals $12,450.
9) Peters CAD has $240,000 of notes payable outstanding at October 31(already recorded on the books). Interest of $2,400 has accrued on these notes by October 31, and will be paid when the notes mature in 2020.
10) Peters CAD received a $12,000 deposit in June from a client for a job to be completed by the end of the fiscal year (this part of the transaction was already properly recorded). Peters CAD completed the job on October 31.
Required: Prepare accounting adjustments required at October 31 using the financial statement effects template that follows

Quizplus · Accepted Answer

The Answer of You have been hired by Peters CAD, a small engineering and drafting firm, to help prepare a set of financial statements for the bank for the fiscal year ending October 31. You have reviewed all the transactions for the year and find the following information that has not been recorded in the company's books. 
1) During October, Peters CAD provided $11,400 of CAD services to clients who will be billed in early November. The firm uses the account Fees Receivable to reflect amounts due but not yet billed.
2) The firm paid $14,400 cash on October 15 for a series of radio commercials to run during October and November. One-third of the commercials have aired by October 31st. The $14,400 payment was recorded in the Prepaid advertising account.
3) Starting October 1, all maintenance work on Peters CAD's computer and printing equipment is handled by PC Guru under an agreement whereby Peters CAD pays a fixed monthly charge of $4,800. Peters CAD paid six months' service charges of $28,800 cash in advance on October 1, and increased its Prepaid expenses account by $28,800.
4) Starting October 16, Peters CAD rented 800 square feet of storage space from a neighboring business. The monthly rent of $4.80 per square foot is due in advance on the first of each month. Nothing was paid in October, as the neighbor agreed that Peters CAD could pay the rent for October with the November 1 rent payment.
5) Peters CAD invested $60,000 cash in securities on October 1 (this part of the transaction was already properly recorded) and earned interest of $1,200 on these securities by October 31. No interest will be received until January.
6) Monthly depreciation on the equipment is $870. No depreciation has been recorded yet for the year.
7) Weekly salaries for a five-day week total $37,500, payable on Fridays. October 31 of the current year is a Tuesday.
8) A bill for work done during August and September has not yet been sent because the client is out of the country. The bill totals $12,450.
9) Peters CAD has $240,000 of notes payable outstanding at October 31(already recorded on the books). Interest of $2,400 has accrued on these notes by October 31, and will be paid when the notes mature in 2020.
10) Peters CAD received a $12,000 deposit in June from a client for a job to be completed by the end of the fiscal year (this part of the transaction was already properly recorded). Peters CAD completed the job on October 31.
Required: Prepare accounting adjustments required at October 31 using the financial statement effects template that follows

You Have Been Hired by Peters CAD, a Small Engineering