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Exercise 22-19 A partial trial balance of Kingbird Corporation is as follows on December 31, 2018....

Exercise 22-19 A partial trial balance of Kingbird Corporation is as follows on December 31, 2018. Dr. Cr. Supplies $2,500 Salaries and wages payable $1,500 Interest Receivable 5,400 Prepaid Insurance 90,600 Unearned Rent 0 Interest Payable 13,900 Additional adjusting data: 1. A physical count of supplies on hand on December 31, 2018, totaled $1,000. 2. Through oversight, the Salaries and Wages Payable account was not changed during 2018. Accrued salaries and wages on December 31, 2018, amounted to $4,000. 3. The Interest Receivable account was also left unchanged during 2018. Accrued interest on investments amounts to $4,800 on December 31, 2018. 4. The unexpired portions of the insurance policies totaled $59,200 as of December 31, 2018. 5. $29,500 was received on January 1, 2018, for the rent of a building for both 2018 and 2019. The entire amount was credited to rent revenue. 6. Depreciation on equipment for the year was erroneously recorded as $5,200 rather than the correct figure of $52,000. 7. A further review of depreciation calculations of prior years revealed that equipment depreciation of $7,900 was not recorded. It was decided that this oversight should be corrected by a prior period adjustment.

Assuming that the books have not been closed, what are the adjusting entries necessary at December 31, 2018? (Ignore income tax considerations.)

Assuming that the books have been closed, what are the adjusting entries necessary at December 31, 2018? (Ignore income tax considerations.)

Pass the necessary adjusting entries for the following taking into account income tax effects (40% tax rate) and assuming that the books have been closed.

1. Depreciation on equipment for the year was erroneously recorded as $5,200 rather than the correct figure of $52,000.
2. A further review of depreciation calculations of prior years revealed that equipment depreciation of $7,900 was not recorded. It was decided that this oversight should be corrected by a prior period adjustment.

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jeff jeffy answered 3 months ago
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