Question

Question: During the year, a company recorded prepayments of expenses in asset accounts, and cash receipts of

unearned revenues in liability accounts. At the end of its annual accounting period, the company must

make three adjusting entries:

(1) Accrue salaries expense. Dr. ___ Cr. ___

(2) Adjust the Unearned Services Revenue account to recognize earned revenue. Dr. ___ Cr. ___

(3) Record services revenue earned for which cash will be received the following period. Dr. ___ Cr. ___

For each of the adjusting entries (1), (2), and (3), indicate the account to be debited and the account to be

credited—from a through i below.

a. Prepaid Salaries d. Unearned Services Revenue g. Accounts Receivable

b. Cash e. Salaries Expense h. Accounts Payable

c. Salaries Payable f. Services Revenue i. Equipment

Answer 1

Step-by-Step Solution

Step 1: Definition of accrued expense

Accrued expenses are the expenses that are due but not paid.

Step 2: Adjusting entries

Date	Particulars	Debit	Credit
1.	Salaries Payable	$
	Salaries Expense		$
	(Adjusting entry for accrued salary)
2.	Unearned Revenue	$
	Service Revenue		$
	(Adjusting entry for unearned revenue)
3.	Cash	$
	Service Revenue		$
	(Adjusting entry for revenue received)

 

 

 

Answer:

Debit salaries payable and credit salaries expense account for adjusting entry.