Question

In: Accounting

The following unadjusted trial balance was taken from thebooks of Sela Corporation at the end...

The following unadjusted trial balance was taken from the books of Sela Corporation at the end of its fiscal year on June 30, 2020. Sela Corporation offers accounting professional services to clients.

Account Debit Credit

Cash $30,000

Accounts Receivable 50,000

Notes Payable $24,000

Allowance for Doubtful Accounts 1,000

Supplies 34,000

Prepaid Insurance 20,000

Equipment, cost 200,000

Accumulated Depreciation--Equip. 25,000

Income Tax Payable 10,800

Common Stock 44,200

Retained Earnings 7/1/2019 50,000

Service Revenue 276,000

Unearned Service Revenue 5,000

Utilities expense 30,000

Salaries and Wages Expense 54,000

Rent Expense 18,000

Totals $436,000 $436,000

At year end, the following items have either not yet been recorded or not recorded properly.

a. Insurance expired during the year, $2,000

b. Estimated bad debts for the year $900

c. Depreciation on equipment, 5% per year on original cost.

d. The note payable is a 90-day, 3% APR. The note was given to the bank on May 31, 2020 (assume 360 days in a year).

e. Rent paid in advance at June 30, 2020, $5,000 (originally charged to rent expense).

f. Accrued salaries and wages at June 30, 2020, $8,200

g. Of the unearned service revenue, $2,400 was earned on June 30, 2020.

h. Tax returns service for $3,500 was provided to a client but the client was not billed by June 30, 2020.

i. An inventory count on June 30, 2020 showed $4,000 of supplies on hand.

What is the correct journal entry for adjustment e above?

Select one:

a. Debit prepaid rent $5,000; and credit rent expense $5,000

b. Debit cash $5,000; and credit prepaid rent $5,000

c. Debit rent expense $5,000; and credit prepaid rent $5,000

Debit rent expense $5,000; and credit cash $5,000

Solutions

Expert Solution

Answer: a. Debit prepaid rent $5,000; and credit rent expense $5,000

----

ekkarill92 answered 2 years ago

Next > < Previous

Related Solutions

Following is the unadjusted trial balance of Baltimore Rentals Corporation at the end of its first...

Following is the unadjusted trial balance of Baltimore Rentals Corporation at the end of its first year of operations, December 31, 20X5: Account Debit Credit Cash 3,300 Accounts receivable 4,000 Supplies 500 Truck 8,000 Acc. dep. – truck 0 Accounts payable 5,000 Unearned rent revenue 2,400 Income taxes payable 0 Capital Stock 7,000 Dividends 1,000 Rent earned 16,000 Commissions expense 1,000 Depreciation expense-truck 0 Supplies expense 0 Salaries expense 7,000 Telephone expense 0 Income tax expense 0 Rent expense 5,600...

1. & 2. The following data are taken from the unadjusted trial balance of the Westcott...

1. & 2. The following data are taken from the unadjusted trial balance of the Westcott Company at December 31, 2017. Complete the work sheet following adjustment. (Enter their balances in the correct Debit or Credit column.) Use the following adjustment information to complete the work sheet. Depreciation on equipment, $22 Accrued salaries, $14 The $25 of unearned revenue has been earned Supplies available at December 31, 2017, $17 Expired insurance, $13 WESTCOTT COMPANY Partial Work Sheet For the...

The following list of accounts is taken from the December 31, 2020, unadjusted trial balance of...

The following list of accounts is taken from the December 31, 2020, unadjusted trial balance of Perdu Sales, a business that is owned by Eldon Perdu. Debit Credit Cash $ 8,000 Merchandise inventory 9,800 Prepaid selling expense 8,000 Store equipment 40,000 Accumulated depreciation, store equipment $ 9,800 Accounts payable 14,840 Salaries payable 0 Eldon Perdu, capital 25,360 Eldon Perdu, withdrawals 3,600 Sales 858,000 Sales returns and allowances 33,000 Sales discounts 8,000 Cost of goods sold 431,000 Sales salaries expense 94,000...

The following unadjusted trial balance is taken from the ledger of Tim’s Top Business Services on...

The following unadjusted trial balance is taken from the ledger of Tim’s Top Business Services on 30 June 2019. Account Debit Credit Cash at bank Accounts receivable Prepaid insurance Equipment Accumulated depreciation – equipment Accounts payable Tim Wang, Capital Tim Wang, Drawings Service revenue Wages expense Electricity expense Sundry expense $48 000 74 000 24 000 130 000 50 000 130 000 54 000 26 000 $60 000 64 000 72 000 340 000 $536 000 $536 000 Additional...

The following unadjusted trial balance is for Ace Construction Co. as of the end of its...

The following unadjusted trial balance is for Ace Construction Co. as of the end of its 2019 fiscal year. The June 30, 2018, credit balance of the owner’s capital account was $57,800, and the owner invested $25,000 cash in the company during the 2019 fiscal year. ACE CONSTRUCTION CO. Unadjusted Trial Balance June 30, 2019 No. Account Title Debit Credit 101 Cash $ 17,500 126 Supplies 9,500 128 Prepaid insurance 5,500 167 Equipment 141,780 168 Accumulated depreciation—Equipment $ 27,000 201...

The following unadjusted trial balance is for Ace Construction Co. as of the end of its...

The following unadjusted trial balance is for Ace Construction Co. as of the end of its 2019 fiscal year. The June 30, 2018, credit balance of the owner’s capital account was $57,700, and the owner invested $26,000 cash in the company during the 2019 fiscal year. ACE CONSTRUCTION CO. Unadjusted Trial Balance June 30, 2019 No. Account Title Debit Credit 101 Cash $ 16,000 126 Supplies 9,000 128 Prepaid insurance 7,000 167 Equipment 135,920 168 Accumulated depreciation—Equipment $ 25,000 201...

The following unadjusted trial balance is for Ace Construction Co. as of the end of its...

The following unadjusted trial balance is for Ace Construction Co. as of the end of its 2019 fiscal year. The June 30, 2018, credit balance of the owner’s capital account was $51,200, and the owner invested $22,000 cash in the company during the 2019 fiscal year. ACE CONSTRUCTION CO. Unadjusted Trial Balance June 30, 2019 No. Account Title Debit Credit 101 Cash $ 16,500 126 Supplies 10,000 128 Prepaid insurance 5,000 167 Equipment 146,510 168 Accumulated depreciation—Equipment $ 26,500 201...

The following unadjusted trial balance is for Ace Construction Co. as of the end of its...

The following unadjusted trial balance is for Ace Construction Co. as of the end of its 2019 fiscal year. The June 30, 2018, credit balance of the owner’s capital account was $52,500, and the owner invested $20,000 cash in the company during the 2019 fiscal year. ACE CONSTRUCTION CO. Unadjusted Trial Balance June 30, 2019 No. Account Title Debit Credit 101 Cash $ 18,500 126 Supplies 9,000 128 Prepaid insurance 5,500 167 Equipment 130,970 168 Accumulated depreciation—Equipment $ 20,000 201...

The following unadjusted trial balance is for Ace Construction Co. as of the end of its...

The following unadjusted trial balance is for Ace Construction Co. as of the end of its 2019 fiscal year. The June 30, 2018, credit balance of the owner’s capital account was $55,900, and the owner invested $22,000 cash in the company during the 2019 fiscal year. ACE CONSTRUCTION CO. Unadjusted Trial Balance June 30, 2019 No. Account Title Debit Credit 101 Cash $ 19,500 126 Supplies 7,500 128 Prepaid insurance 6,000 167 Equipment 130,180 168 Accumulated depreciation—Equipment $ 29,000 201...

The following unadjusted trial balance is prepared at fiscal year-end for Nelson Company. NELSON COMPANY Unadjusted...

The following unadjusted trial balance is prepared at fiscal year-end for Nelson Company. NELSON COMPANY Unadjusted Trial Balance January 31, 2019 Debit Credit Cash $ 17,550 Merchandise inventory 12,500 Store supplies 5,400 Prepaid insurance 2,500 Store equipment 42,700 Accumulated depreciation—Store equipment $ 16,200 Accounts payable 17,000 J. Nelson, Capital 16,000 J. Nelson, Withdrawals 2,000 Sales 130,300 Sales discounts 1,850 Sales returns and allowances 2,300 Cost of goods sold 38,000 Depreciation expense—Store equipment 0 Sales salaries expenses 15,250 Office salaries expenses...

Subjects