Question

Directions: Prepare journal entries with the following information
a). Purchased a 18 month insurance policy on June 1st for $36,000.
Record the purchase along with the December 31 adjusting entry
Date	Account			Debit		Credit
1-Jun	Prepaid Insurance			36,000
		Insurance Expense				10,000
31-Dec
b) Donald had supplies of $10,000 on January 1, purchased supplies in the year of $25,000
and had $18,000 supplies remaining on December 31
Date	Account			Debit		Credit
Various	Cash			25,000
		Supplies
31-Dec	Supplies			$      18,000
		Cash
c) On December 16th, Daisy Duck rented a truck for 60 days for $4,500
Record the journal entry od December 16th and December 31st

Answer 1

Date	Account	Debit	Credit
1-Jun	Prepaid Insurance	$36,000.00
	Cash		$36,000.00
31-Dec	Insurance Expense	$14,000.00
	Prepaid Insurance (36000/18*7)		$14,000.00
Date	Account	Debit	Credit
	Supplies	$25,000.00
	Cash		$25,000.00
31-Dec	Supplies Expense	$17,000.00
	Supplies (10000+25000-18000)		$17,000.00
Date	Account	Debit	Credit
16-Dec	Cash	$4,500.00
	Unearned Rent Revenue		$4,500.00
31-Dec	Unearned Rent Revenue	$1,200.00
	Earned Rent revenue ( 4500/60*16)		$1,200.00