Question

Prepare the following adjusting journal entries.

1. Services billed for the period of $12,000

2. Wages accrued for the week of $1,200

3. Property taxes accrued for the month of $2,000

4. Supplies used during the period of $1,700

5. Depreciation on equipment of $2,000, on computers of $1,000, on furniture and fixtures of $1,000, and on buildings of $3,000

6. Prepaid Insurance that expired during the month of $2,400

7. Prepaid rent from prior month of $1,000

8. Unearned rental revenue of $2,000 that was earned during the period.

9. Accrued interest of 1-month based on $100,000 loan at 6%.

10. Accrued interest of 1-month based on savings account investment of $10,000 at 6%

Answer 1

Solution:

Journal Entries
Event	Particulars	Debit	Credit
1	Accounts receivables Dr	$12,000.00
	To Service revenue		$12,000.00
	(To record service revenue)
2	Wages expense Dr	$1,200.00
	To Wages Payable		$1,200.00
	(To record wages due)
3	Property Taxes Dr	$2,000.00
	To Property taxes payable		$2,000.00
	(To record accrual of property taxes)
4	Supplies expense Dr	$1,700.00
	To Supplies		$1,700.00
	(To record supplies used)
5	Depreciation expense Dr	$7,000.00
	To Accumulated depreciation - Equipment		$2,000.00
	To Accumulated depreciation - Computer		$1,000.00
	To Accumulated depreciation - Furniture and fixtures		$1,000.00
	To Accumulated depreciation - Building		$3,000.00
	(To record depreciation expense)
6	Insurance expense Dr	$2,400.00
	To Prepaid insurance		$2,400.00
	(To record prepaid insurance expired)
7	Rent expense Dr	$1,000.00
	To Prepaid Rent		$1,000.00
	(To record rent expense)
8	Unearned rental revenue Dr	$2,000.00
	To Rent revenue		$2,000.00
	(To record rent revenue)
9	Interest expense Dr	$500.00
	To Interest payable ($100,000*6%*1/12)		$500.00
	(To record interest expense accrued)
10	Interest receivables Dr	$50.00
	To Interest revenue ($10,000*6%*1/12)		$50.00
	(To record interest accrued on saving account investment)