The Office Supplies account started the year with a $3,875 balance. During 2015, the company purchased...

The Office Supplies account started the year with a $3,875 balance. During 2015, the company purchased supplies for $16,004, which was added to the Office Supplies account. The inventory of supplies available at December 31, 2015, totaled $3,410.

Record the adjusting entry related to the company's insurance.

The company has 15 employees, who earn a total of $2,650 in salaries each working day. They are paid each Monday for their work in the five-day workweek ending on the previous Friday. Assume that December 31, 2015, is a Tuesday, and all 15 employees worked the first two days of that week. Because New Year’s Day is a paid holiday, they will be paid salaries for five full days on Monday, January 6, 2016.

The company purchased a building on January 1, 2015. It cost $875,000 and is expected to have a $45,000 salvage value at the end of its predicted 30-year life. Annual depreciation is $27,667.

Since the company is not large enough to occupy the entire building it owns, it rented space to a tenant at $2,500 per month, starting on November 1, 2015. The rent was paid on time on November 1, and the amount received was credited to the Rent Earned account. However, the tenant has not paid the December rent. The company has worked out an agreement with the tenant, who has promised to pay both December and January rent in full on January 15. The tenant has agreed not to fall behind again.

On November 1, the company rented space to another tenant for $2,265 per month. The tenant paid five months' rent in advance on that date. The payment was recorded with a credit to the Unearned Rent account.

Note: Enter debits before credits.

Transaction	General Journal	Debit	Credit
a

+

Office supplies expense

Expert Solution

Office Supplies Expenses

Opening Balance	$3,875
Add: Purchase	$16,004
Less: Closing Balance	$3,410
Supply Exp For the year	$16,469

Total Salary = $2,650 per working day
Working Days = 5 days (Mon to Fri)
Payment Day = Monday.
Till 31st dec there is two working days related to that month = Mon and Tues = 2days.
Salaries exp related to the month = $2,650 x 2 = $5300

Journal

Transactions	Particulars	Debit in $	Credit in $
a	Office Supplies Exp	$16,469
	Office Supplies		$16,469

b	No entry
	(There is no information/Financial Transactions given related to the business Insurance)

c	Salaries Exp	$ 5,300.00
	Salaries Payable		$ 5,300.00

d	Depreciation Exp	$ 27,667.00
	Accumulated Depreciation		$ 27,667.00

e	Rent Receivables	$ 2,500.00
	Rent earned		$ 2,500.00

f	Unearned Rent	$ 4,530.00
	Rent Earned		$ 4,530.00
	($2265 x 2)
	[Assuming on 30 nov no rent earned entry passed]

ekkarill92 answered 1 year ago

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