Question

Desoto Company must make three adjusting entries on December 31, 2019.

1. Supplies used, $9,800 (supplies totaling $15,600 were purchased on December 1, 2019, and debited to the Suppliesaccount).
2. Expired insurance, $7,000; on December 1, 2019, the firm paid $42,000 for six months’ insurance coverage in advance and debited Prepaid Insurance for this amount.
3. Depreciation expense for equipment, $4,600.

Required:
Prepare the journal entries for these adjustments and post the entries to the general ledger accounts

General Journal

Ledger

Answer 1

Journal entries
Particulars			Debit	Credit
supplies expenses			9800
supplies				9800
insurance expenses			7000
prepaid insurance				7000
depreciation expenses			4600
accumulated depreciation				4600
Supplies
01-Dec	15600	31-Dec	9800
31-Dec	5800
supplies expenses
31-Dec	9800
31-Dec	9800
Prepaid insurance
01-Dec	42000	31-Dec	7000
31-Dec	35000
Insurance expenses
31-Dec	7000
31-Dec	7000
Accumulated depreciation
		31-Dec	4600
		31-Dec	4600
Depreciation expenses
31-Dec	4600
31-Dec	4600