Question

Michelle Walker, D.D.S., opened a dental practice on January 1, 2020. During the first month of operations, the following transactions occurred.

1.		Performed services for patients who had dental plan insurance. At January 31, $678 of such services was performed but not yet billed to the insurance companies.
2.		Utility expenses incurred but not paid prior to January 31 totaled $482.
3.		Purchased dental equipment on January 1 for $73,000, paying $19,000 in cash and signing a $54,000, 3-year note payable. (a) The equipment depreciates $376 per month. (b) Interest is $470 per month.
4.		Purchased a one-year malpractice insurance policy on January 1 for $12,360.
5.		Purchased $1,513 of dental supplies. On January 31, determined that $490 of supplies were on hand.

Prepare the adjusting entries on January 31. Account titles are Accumulated Depreciation—Equipment, Depreciation Expense, Service Revenue, Accounts Receivable, Insurance Expense, Interest Expense, Interest Payable, Prepaid Insurance, Supplies, Supplies Expense, Utilities Expenses, and Accounts Payable. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter 0 for the amounts.)

No. Account Titles and Explanation DEBIT CREDIT

1.

2.

3A

3B

4

5

Answer 1

No.	Accounts title and Explanations	Debit (in $ )	Credit (in $ )
1	Accounts receivable	$ 678
	Service revenue		$ 678
	(To record the services rendered but not billed)
2	Utilities Expenses	$ 482
	Accounts payable (or) Utilities payable		$ 482
	(To record the Utilities Expense incurred but not Paid )
3A	Depreciation Expense	$ 376
	Accumulated depreciation - Equipment                   ($ 376 x 1 month)		$ 376
	(To record the Depreciation Expense )
3B	Interest expense	$ 470
	Interest payable                  ( $ 470 x 1 month)		$ 470
	(To record the Interest expense )
4	Insurance expense ( $ 12,360 x 1/ 12)	$ 1,030
	Prepaid insurance		$ 1,030
	(To record the Insurance expense for the month )
5	Supplies expense ( $ 1,513 (-) $ 490 )	$ 1,023
	Supplies		$ 1,023
	(To record the Supplies )