Question

In: Accounting

Dec 31 Supplies Expenses 45 Supplies 45 Dec 31 Depreciation Expense 40 Accumulated Depreciation - Equipment...

Dec 31 Supplies Expenses 45
Supplies 45
Dec 31 Depreciation Expense 40
Accumulated Depreciation - Equipment 40
Dec 31 Amortization Expense 25
Website 25
Dec 31 Interest expense 23
Interest Payable 23
Dec 31 Insurance expense 100
prepaid expense 100
Dec 31 accounts receivable 450
service revenue 450
Dec 31 supplies expense 1030
supplies 1030
Dec 31 utilities expense 75
accounts payable 75
Dec 31 salaries and wages expense 56
salaries and wages payable 56
Dec 31 unearned service revenue 450
service revenue 450

Part 5    Please prepare the adjusting entries for Cookie Creations.

As of December 31, Cookie Creations’ year-end, the following adjusting entry data are provided.

1. A count reveals that $45 of brochures and posters were used.

2. Depreciation is recorded on the baking equipment purchased in November. The bak- ing equipment has a useful life of 5 years. Assume that 2 months’ worth of depreci- ation is required.

3. Amortization (which is similar to depreciation) is recorded on the website. (Credit the Website account directly for the amount of the amortization.) The website is amortized over a useful life of 2 years and was available for use on December 1.

4. Interest on the note payable is accrued. (Assume that 1.5 months of interest accrued during November and December.) Round to nearest dollar.

5. One month’s worth of insurance has expired.

6. Natalie is unexpectedly telephoned on December 28 to give a cookie class at the neigh- borhood community center on December 31. In early January Cookie Creations sends an invoice for $450 to the community center.

7. A count reveals that $1,030 of baking supplies were used.

8. A cell phone invoice is received for $75. The invoice is for services provided during the month of December and is due on January 15.

9. Because the cookie-making class occurred unexpectedly on December 28 and is for such a large group of children, Natalie’s assistant helps out. Her assistant worked 7 hours at a rate of $8 per hour.

10. An analysis of the unearned revenue account reveals that two of the five classes paid for by the local school board on December 9 still have not been taught by the end of Decem- ber. The $60 deposit received on December 19 for another class also remains unearned.

Instructions

Prepare a general ledger account with the information above.

Thank you.

Solutions

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