Question

Kat's Cat Klinic had the following balance sheet as of December 31, 2015:

Assets:                                                                 Liabilities and Stockholders’ Equity

Cash                                        $    195,000     Accounts Payable                   $      23,000

Accounts Receivable $70,000                        Salaries Payable                             11,400

Less Allowance           (4,500)       65,500     Utilities Payable                                2,100

Prepaid Insurance                          31,000     Interest Payable                                3,800

Supplies                                          29,000     Unearned Revenue                        13,500    

Building                    $510,000                        Notes Payable                                57,000

Accum Depr – Build (185,000)     325,000     Common Stock                             225,000

Equipment                $385,000                       APIC                                             403,000

Accum Depr – Equip(110,000)    275,000     Retained Earnings                        181,700

                                                $    920,500                                                     $    920,500

                                                =========                                                    =========

The following economic events occurred during 2016:

1. Performed services for $ 174,000, all on account.

2. Paid $ 157,000 for salaries that were due. (THINK!)

3. Collected $ 116,000 from customers on account.

4. Received $ 34,000 for services to be performed.

5. Paid $ 7,800 due for utilities. (THINK!)

6. Performed services totaling $ 212,000 of which $ 68,000 was received in cash.

7. Purchased $ 39,000 worth of supplies and paid cash.

8. Paid $ 5,000 for interest due on note. (THINK!)

9. Wrote off uncollectible bad debt of $ 14,300. (See 2012/2030 text or page 363.)

10. Paid $ 147,000 for salaries.

11. Collected $ 186,000 on account.

12. Paid $ 18,000 on account.

13. Issued 60,000 shares of $ 1 par value common stock and received $ 280,000. (See 2012/2030 text or page 1047.)

14. Performed services totaling $ 284,200 of which $ 79,000 was received in cash.

15. Declared and paid a cash dividend of $ 72,000. (Use a dividend account.) (See notes.)

Record tranasctions 1 thru 15 in general journal form -DONE

The Following information pertains to 2017 year-end adjusting entries:

a. Estimated $19,400 for bad debt expense.

b. $ 7000 of insurance remains unexpired at year-end.

c. There are $33,600 worth of supplies on hand.

d. Allocated $21,000 for depreciation of buildings and $38,000 for depreciation of equipment.

e. accrued the following expenses: salaries, $9,200; utilities, $1,700; interest, $4,900.

f. earned $32,900 of prepaid services.

question: RECORD 2017 ADJUSTING ENTRIES A THRU F IN GENERAL JOURNAL FORM

Answer 1

Transactions 1 Through 15:

No.	Account title and explanation	Debit	Credit
1	Accounts receivable	$174,000
	Service revenue		$174,000
	[To record performed services on account]
2	Salaries payable	$11,400
	Salaries expense	$145,600
	Cash		$157,000
	[To record cash paid for salaries]
3	Cash	$116,000
	Accounts receivable		$116,000
	[To record collections from customers]
4	Cash	$34,000
	Unearned service revenue		$34,000
	[To record advance received from customers]
5	Utilities payable	$2,100
	Utilities expense	$5,700
	Cash		$7,800
	[To record cash paid for utilities]
6	Cash	$68,000
	Accounts receivable	$144,000
	Service revenue		$212,000
	[To record service revenue]
7	Supplies	$39,000
	Cash		$39,000
	[To record purchased supplies for cash]
8	Interest payable	$3,800
	Interest expense	$1,200
	Cash		$5,000
	[To record cash paid for interest]
9	Allowance for doubtful account	$14,300
	Accounts receivable		$14,300
	[To record wrote off of uncollectible]
10	Salaries expense	$147,000
	Cash		$147,000
	[To record payment of salaries]
11	Cash	$186,000
	Accounts receivable		$186,000
	[To record collections from customers]
12	Accounts payable	$18,000
	Cash		$18,000
	[To record payment for accounts payable]
13	Cash	$280,000
	Common stock (60,000 x $1)		$60,000
	Additional paid in capital		$220,000
	[To record issuance of common stock]
14	Cash	$79,000
	Accounts receivable	$205,200
	Service revenue		$284,200
	[To record service revenue]
15	Dividend	$72,000
	Cash		$72,000
	[To record payment of dividends]

Adjusting Entries:

No.	Account title and explanation	Debit	Credit
a	Bad debt expense	$19,400
	Allowance for doubtful account		$19,400
	[To record bad debt expense]
b	Insurance expense (31,000-7,000)	$24,000
	Prepaid insurance		$24,000
	[To record insurance expense]
c	Supplies expense [29,000 beg.+ 39,000 purchase-33,600 End.]	$34,400
	Supplies		$34,400
	[To record supplies expense]
d	Depreciation expense	$59,000
	Accumulated depreciation-building		$21,000
	Accumulated depreciation-equipment		$38,000
	[To record depreciation expense]
e	Salaries expense	$9,200
	Utilities expense	$1,700
	Interest expense	$4,900
	Salaries payable		$9,200
	Utilities payable		$1,700
	Interest payable		$4,900
	[To record accrued expenses]
f	Unearned service revenue	$32,900
	Service revenue		$32,900
	[To record revenue earned from prepaid services]