Question

At the end of its fiscal year, Teal Mountain Consulting had the following adjusting entries.

		GENERAL JOURNAL				J1
Date		Account Titles and Explanation		Debit		Credit
Dec. 31		Interest Receivable		630
		Interest Revenue				630
31		Supplies Expense		1,730
		Supplies				1,730
31		Insurance Expense		1,310
		Prepaid Insurance				1,310
31		Depreciation Expense		1,200
		Accumulated Depreciation—Equipment				1,200
31		Salaries Expense		1,150
		Salaries Payable				1,150
31		Interest Expense		75
		Interest Payable				75

Prepare the reversing entries that could be recorded at the beginning of the new fiscal year. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.)

Date	Account Titles and Explanation	Debit	Credit
Jan. 1
	(To reverse accrued interest adjusting entry)
Jan. 1
	(To reverse accrued salaries adjusting entry)
Jan. 1
	(To reverse interest on notes payable entry)

Answer 1

Solution:
	Journal Entries
	Date	Account Title and Explanation	Debit	Credit
	January.01	Interest Revenue	$                          630
		Interest Receivable		$                            630
		(To reverse accrued interest adjusting entry)
	January.01	Salaries Payable	$                       1,150
		Salaries Expenses		$                        1,150
		(To reverse accrued salaries adjusting entry)
	January.01	Interest Payable	$                             75
		Interest Expenses		$                              75
		(To reverse interest on notes payable entry)