Question

Carol Garcia, 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, $698 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 $546.

3. Purchased dental equipment on January 1 for $80,000, paying $18,000 in cash and signing a $62,000, 3-year note payable. (a) The equipment depreciates $419 per month. (b) Interest is $460 per month.

4. Purchased a one-year malpractice insurance policy on January 1 for $13,080. 5. Purchased $1,631 of dental supplies. On January 31, determined that $510 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. enter an account title to record the first transaction Accounts Receivable enter a debit amount 698 enter a credit amount enter an account title to record the first transaction enter a debit amount enter a credit amount

2. enter an account title to record the second transaction enter a debit amount enter a credit amount enter an account title to record the second transaction enter a debit amount enter a credit amount

3. (a) enter an account title to record the third transaction under point A enter a debit amount enter a credit amount enter an account title to record the third transaction under point A enter a debit amount enter a credit amount

3. (b) enter an account title to record the third transaction under point B enter a debit amount enter a credit amount enter an account title to record the third transaction under point B enter a debit amount enter a credit amount

4. enter an account title to record the fourth transaction enter a debit amount enter a credit amount enter an account title to record the fourth transaction enter a debit amount enter a credit amount

5. enter an account title to record the fifth transaction enter a debit amount enter a credit amount enter an account title to record the fifth transaction enter a debit amount enter a credit amount

Answer 1

Adjusting entries

date	account and explanation	Debit	Credit
Jan 31	Account receivable	698
	Service revenue		698
	(To record service revenue)
Jan 31	Utilities expense	546
	Account payable		546
	(To record utilities payable)
Jan 31	Depreciation expense	419
	Accumulated Depreciation—Equipment		419
	(To record depreciation)
	Interest expense	460
	Interest payable		460
	(To record interest)
Jan 31	Insurance expense (13080/12)	1090
	Prepaid insurance		1090
	(To record insurance expense)
Jan 31	Supplies expense (1631-510)	1121
	Supplies		1121
	(To record supplies adjusted)