In: Accounting
Carla Vista Company has a September 30 fiscal year end and
prepares adjusting entries on an annual basis. The trial balance
included the following selected accounts:
Accumulated depreciation | $4,650 | |
Depreciation expense | 0 | |
Interest expense | 3,400 | |
Interest payable | 0 | |
Interest receivable | 0 | |
Interest revenue | 0 | |
Salaries expense | 155,000 | |
Salaries payable | 0 |
Additional information for its September 30, 2021, year-end
adjustments:
1. | Carla Vista has a two-year, 3.5% note receivable for $4,800 that was issued on April 1, 2021. Interest is payable every six months, on October 1 and April 1. Principal is payable at maturity. Carla Vista collected the correct amount on October 1, 2021. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2. | Accrued salaries as at September 30, 2021, were $2,300. Payroll totalling $2,830 was paid on October 2, 2021. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
3. | Carla Vista has a five-year, 5% note payable for $81,600 issued in 2019. Interest is payable quarterly on January 31, April 30, July 31, and October 31 each year. Carla Vista paid the correct amounts in 2021. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
4. |
Depreciation expense for the year ended September 30, 2021, was $4,650. Post adjusting journal entries for items 1 to 4 above.
(Post entries in the order of journal entries presented
above. Round answers to 0 decimal places, e.g.
5,275.)
|
Account Titles | Debit | Credit | |
Interest Receivable | $ 84 | =4800*3.5%*6/12 | |
Interest Revenue | $ 84 | ||
Salaries Expense | $ 2,300 | ||
Salaries Payable | $ 2,300 | ||
Interest Expense | $ 680 | =81600*5%*2/12 | |
Interest Payable | $ 680 | ||
Depreciation Expense | $ 4,650 | ||
Accumulated Depreciation | $ 4,650 |
Interest Receivable | |||
1 | 84 | ||
84 | |||
Interest Revenue | |||
84 | 1 | ||
84 | Bal | ||
Salaries Payable | |||
2300 | 2 | ||
2300 | Bal | ||
Salaries Expense | |||
Sept. 30 Bal. | 155,000 | ||
2 | 2300 | ||
Bal | 157,300 | ||
Interest Payable | |||
680 | 3 | ||
680 | Bal | ||
Interest Expense | |||
Sept. 30 Bal. | 3,400 | ||
3 | 680 | ||
Bal | 4,080 | ||
Accumulated Depreciation | |||
4,650 | Sept. 30 Bal. | ||
4650 | 4 | ||
9,300 | Bal | ||
Depreciation Expense | |||
4 | 4650 | ||
Bal | 4650 |
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