Adjusting Accounts MacKenzie Enterprise includes the following accounts in its general ledger, Explain why each of...

Adjusting Accounts

MacKenzie Enterprise includes the following accounts in its general ledger, Explain why each of these accounts may need to be adjusted.

Rent Payable

Unearned Revenue

Prepaid Subscriptions

Depreciation Expense

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Answer

Rent Payable

Rent Payable means there is some outstanding liability of Rent which we have to pay. And in Current period (For which we are preparing Financial Statements) if we have paid that Outstanding Liability then it needs to be adjusted from Rent Payable.

So we need to Adjust Rent Payable.

Unearned Revenue

Unearned Revenue is the Revenue which is received but we have not earned it yet, so it’s a Liability for the Business. So in Current period, if any of the Unearned Revenue is earned in that period then it needs to be adjusted.

So we need to Adjust Unearned Revenue.

Prepaid Subscription

Prepaid Subscription is the Subscription which we have paid in Advance i.e. it is not due yet but we have paid in advance and It is an Asset to the Company. SO if in Current Period if that Prepaid Subscription is due then it needs to be adjusted.

So we need to Adjust Prepaid Subscription.

Depreciation Expense

Depreciation is the decrease in the value of Asset due to Normal Usage of the Asset, and it is a business expense.

Depreciation decreases the Value of Asset to reveal the fair value of Asset.

So Depreciation needs to be adjusted.

Dear Student, if u have any doubt, plz feel free to reach me.

ekkarill92 answered 1 year ago

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