on july 1 olive co paid $7,500

amortization, the periodic interest A:Solution The aim of a post-closing trial balance is to verify that (1) total debits equal total credits for The balance in the unearned fees account, before adjustment at the end of the year, is 18,000. The expense recognition (matching) principle does not aim to record expenses in the same On May 1, Sellers Marketing Company received $1,500 from Franco Marcelli for a record the salaries earned but unpaid is: (A reconciliation schedule is not required.). paid toward them); Prepaid $8,000 cash for costs that will not be expensed until next year. NATIONALINTERCABLECOMPANYIncomeStatementForYearEndedDecember31,2021($inmillions)RevenuesSalesrevenueInvestmentrevenueGainonsaleofinvestmentsExpensesCostofgoodssoldSalariesexpenseDepreciationexpenseAmortizationexpenseBaddebtexpenseInsuranceexpense13InterestexpenseLossonsaleofbuildingIncomebeforetaxIncometaxexpenseNetincome$32015512555251730422984220$22$340. indicates that Flo's can cover its short term liabilities with its short term assets. \text{Investment revenue} &15\\ Income Summary account has a credit balance of $6,000, and its Dividends account has a debit So, firm will pay interest to A and B on Q:For each of the following errors in property, plant and equipment accounts, indicate a specific inte A:Answer: . Copyright 2019 McGraw-Hill Education. Based on the information provided, make the journal entries needed to bring the balances to correct for: A. original transaction B. December 31 adjustment. Which of the following does not require an adjusting entry at year-end? All rights reserved. Net income $110,000 E) A credit to a liability and a debit to a prepaid expense for $1,875. A long-term investment in bonds, originally purchased for$30 million, was sold for $35 million. . C) Recognizes revenues when received in cash. On July 1, a client paid an advance payment (retainer) of $10,000, to cover future legal services. The work sheet is a required report made available to external decision makers. Adjusting entries are usually entered in the work sheet before they are entered in the general journal. B) $21,000. the same period. 129 A:Interest Income -It is the amount of money paid by the borrower to the lenders on the amount of mon Q:Selected data concerning the past years operations of the Beachwear Manufacturing Company are as fo A:Cost of Raw Material Purchased: In the fundamental production and manufacture of items, raw material Q:Compute for the net sales that would be reported in LIVA company's Income Statemen. = A) A debit to an expense and a credit to a prepaid expense for $5,625. Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. D) An understatement of liabilities. Closing entries result in the Dividends account being transferred into net income or net loss Professor Parsons, Lesson 8 Faults, Plate Boundaries, and Earthquakes, General Chemistry I - Chapter 1 and 2 Notes, Chapter 3 - Summary Give Me Liberty! 19 A) $17,000. The fir A:Note: 1/10, n/30: Here, 1 represent the discount rate if payment is made within ten days. Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. A company purchased a new delivery van at a cost of $45,000 on July 1. record revenue when services/products are delivered and records expense when it is incurred, revenue recorded when goods and services are provided to customers, expenses be recorded during the same accounting period as revenues that are recognized as the result of those expenses, Net Income / Net Sales x 100 Prior to recording adjusting entries at the end of an accounting period, some accounts may D) Accrual reporting principle. 2. Reece Financial Services Co., which specializes in appliance repair services, is owned and operated by Joni Reece. was initially recorded as Unearned Revenue. C) An understatement of assets. $7,500/2 = $3,750 per month. ACG2021 Additional Practice Questions Chapter 7-12, Lecture notes for Week 2, CHAPTER 2 NATIONAL DIFFERENCES IN POLITICAL, ECONOMIC, AND LEGAL SYSTEMS, Business Systems Analysis and Design (IT210), Biotechnology Applications (BIOTECH 10007110), Educational Technology for Teaching and Learning (D092), Emotional and Cultural Intelligence (D082), Organic Chemistry Laboratory I (CHEM 223), Accounting Information Systems (ACCTG 333), Introduction to Christian Thought (D) (THEO 104), Critical Thinking In Everyday Life (HUM 115), Legal Issues in Information Security (C 841), Professional Application in Service Learning I (LDR-461), Advanced Anatomy & Physiology for Health Professions (NUR 4904), Principles Of Environmental Science (ENV 100), Operating Systems 2 (proctored course) (CS 3307), Comparative Programming Languages (CS 4402), Business Core Capstone: An Integrated Application (D083), Untitled document - WRD 111 Prior to recording adjusting entries, the Office Supplies account had a $388 debit balance. income under the cash basis of accounting is: *Response times may vary by subject and question complexity. When a company overestimates its tax liability, this results in the business paying a prepaid tax. It is also known as end of period adjustment. A) Affect only income statement accounts. The ending retained earnings balance after closing is: $361,400 \end{array} b. Debit Insurance Expense, $4,500 Credit Prepaid Insurance, $4,500. Trekker Bikes' current assets are $300 million and its current liabilities are $125 million. 21,875 On January 1, a company purchased a five-year insurance policy for $2,300 with coverage starting immediately. Plum follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. The Retained earnings account has a credit balance of $46,000 before closing entries are made. If total revenues for the period are $80,200, total expenses are $58,800, and dividends are $13,500, what is the ending balance in the Retained earnings account after all closing entries are made? adjusting entry made by Fragmental Co. on December 31 would be: 10 Purposive Communication Module 2, Recrystallization of Benzoic Acid Lab Report, 46 modelo de carta de renuncia voluntaria, Leadership class , week 3 executive summary, I am doing my essay on the Ted Talk titaled How One Photo Captured a Humanitie Crisis https, School-Plan - School Plan of San Juan Integrated School, SEC-502-RS-Dispositions Self-Assessment Survey T3 (1), Techniques DE Separation ET Analyse EN Biochimi 1. A company performs 20 days of work on a 30-day contract before the end of the year. 22,250 The $6,000 cash receipt Key word, is AFTER adjusting and reversing entries were made on Dec 31 and Jan 1. Prepaid taxes will be reversed within one year but can resu. The balance in the supplies account, before adjustment at the end of the year, is 5,330. Q:Sarasota Company has the following stockholders equity accounts at December 31, 2020. \text{Insurance expense }13 C) Unearned expenses. Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. 155210 On July 1 Olive Co. paid $7,500 cash for management services to be performed over a two-year period. This result implies that Cleaver In preparing a work sheet an adjusted trial balance amount is mistakenly sorted to the wrong work sheet column. The comparative balance sheets for 2021 and 2020 and the statement of income for 2021 are given below for National Intercable Company. What is the correct closing entry for the expense accounts? period. Otisco debited the prepayment to a Prepaid Subscriptions account, and the subscriptions started immediately. B) Operating cycle accounting. Useful for showing a business' operating results and and shows the percent of profit in each dollar of sales, Less:Allowanceforuncollectibleaccounts, Claudia Bienias Gilbertson, Debra Gentene, Mark W Lehman, Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Fundamentals of Financial Management, Concise Edition, Don Herrmann, J. David Spiceland, Wayne Thomas. 5 On December 31, $75 worth of office supplies remained. B) Net sales divided by assets. P 30, Q:Eisha Company conducted a physical count on December 31, 2021 which showed inventory with a total Accrued expenses at the end of one accounting period are expected to result in cash Prepare journal entries to record the purchase and the related year-end adjusting entry. . adjusting entry is made at the end of the period to bring the asset account balance to the correct On July 1 Olive should record: A debit to a prepaid expense and a credit to Cash for $7,500. In what ways would it be more difficult? Interest and principal will be collected when the loan matures one year from the issue date. B) Items that require adjusting entries. The general ledger balance before any adjustment is $2,050. business or services, returns, discounts Q:Ayo Company started 2022 with P94,000 of merchandise inventory on zero balances. Its A company earned $3,000 in net income for October. A work sheet contains all of the balances for each account and therefore may be used as a C) Cause an accrued liability account to exist. C) $4,000. Salaries Payable (Debit) 2,500 except : E) Going-concern assumption. B) Prepaid expenses. Bonds Payable D) Expense recognition (Matching) principle. van during the first year ended December 31? \text{Preferred stock} &50 &0\\ A debit to a prepaid expense and a credit to an expense for $1,925. c. focusing solely on the morality of an issue. The correct adjusting entry for accrued and unpaid employee salaries of $9,900 on December 31 is: Debit Salary Expense, $9,900; credit Salaries Payable, $9,900. C) Profit margin can be used to compare a firm's performance to its competitors. B) 117%. 17 It is very necessary to check and verify that the transaction transferred to ledgers from the journal are accurately, At the end of every accounting period Adjustment Entries are made in order to adjust the accounts precisely replicate the expenses and revenue of the current period. No reproduction or distribution without the prior written onsent of Mc. The entry to close the income summary account will be: Debit Retained earnings $25,000; credit Income Summary $25,000. Chase Company has 10 employees, who earn a total of $1,800 in salaries each working day. After preparing and posting the closing entries for revenues and expenses, the income summary account has a debit balance of $25,000. A ledger is an account that provides information on all the transactions that have taken place during a particular period. Which of the following assets is not depreciated? Recording expenses early overstates current-period income; recording expenses late The amount of interest revenue that should be reported in the first year is: $5,000 General Ledger balance Supplies on hand = Supplies used sheet account, and never cash. The current ratio is computed by dividing current liabilities by current assets. amounted to $3,500. C) Debit Prepaid Insurance, $360; credit Insurance Expense, $360. fees had been earned. Debit Income Summary $51,000; credit Revenues $51,000. books of Kingsley Ltd.: 1) A company's fiscal year must correspond with the calendar year. g.$20 million par value of common stock was sold for $30 million, and$50 million of preferred stock was sold at par. A debit to Cash for $7,500 and a credit to an expense for $7,500. are called . months or 52 weeks. If Bojana Tax Services' office supplies account balance on March 1 was $1,050, the company purchased $600 of supplies during the month, and a physical count of supplies on hand at the end of March indicated $1,250 unused, what is the amount of the adjusting entry for office supplies on March 31? A:Special-order decisions are the business decisions in which management has to accept or reject a spe Q:Under the effective-interest method of bond discount or premium D) Are listed on the balance sheet as liabilities. Net \text{Salaries payable}& 3 &8\\ It A:Trade discount = List price x Single discount rate $3,348/36 = $93.00 per monthYear 1: $93.00 9 months = $837.00Year 2: $93.00 12 months = $1,116.00Year 3: $93.00 12 months = $1,116.00Year 4: $93.00 3 months = $279.00. $1,620/36 = $45 per monthYear 1 = $1,620 ($45 9) = $1,215. Accounts that appear in the balance sheet are often called temporary (nominal) accounts. E) Net sales divided by net income. A debit to an expense and credit to Cash. Interim financial statements report a company's business activities for a one-year period. d. demotions, For BUL's financial statement, list the accounting captions that would be most impacted by the two transactions and consider the potential impact (i.e C) Recognize assets purchased during the period. 21,875 : an American History (Eric Foner), Principles of Environmental Science (William P. Cunningham; Mary Ann Cunningham), Educational Research: Competencies for Analysis and Applications (Gay L. R.; Mills Geoffrey E.; Airasian Peter W.), Business Law: Text and Cases (Kenneth W. Clarkson; Roger LeRoy Miller; Frank B. they are earned and to match expenses with revenues. D) Intangible asset. The entry to close the Income Summary account at the end of the year, after revenue and expense accounts have been closed, is: Debit Income Summary $84,300; credit Retained earnings $84,300. Assuming the company does not prepare reversing entries, which of the following entries would be prepared to record the $5,600 payment of salaries in January of the following year? Copyright 2019 McGraw-Hill Education. Journalize the adjusting entry required at the end of the year, assuming the amount of unexpired insurance related to future periods is 7,360. Question: Check my work On July 1 of the current calendar year, Olive Co. paid $7700 cash for management services to be performed over a two-year period beginning July 1 Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. D) $6,750. P A:Net realizable value = Selling price - cost to sell - cost to complete. not in helping to prepare interim financial statements. In this case, the adjusting entry for accrued revenue on December 31 should be: This site is using cookies under cookie policy . Currently, the company is operating at 80 percent of cap Q:yo Company started 2022 with P94,000 of merchandise inventory on hand. The adjusting entry on December 31 of the current year for Olive would . Fragmental collected the entire $9,800 cash on October 1 and recorded it as unearned revenue. d. the repression of disturbing thoughts. 18,750 After closing entries are posted, what will be the balance in the Retained earnings account? Cash, short-term investments, and accounts receivable divided A:Solution: The entry to close the dividends account at the end of the year is: Debit Retained earnings $5,500; credit Dividends $5,500. B) Debit Salaries Payable and credit Salaries Expense. The adjusting entry needed on December 31 is: Debit Salaries Expense, $5,400 Credit Salaries Payable, $5,400. 1110 of $1,500 from this contract for October. columns, a net loss is indicated. If investors observe multiple "red flags" when doing an accounting policy analysis, accounting period as the revenue earned as a result of these expenses. A) Store fixtures. Q:Loft Corporation received an RM945 invoice for kitchen ingredients with terms of 1/10, n/30. E) Assuring that external transaction amounts remain unchanged. revenues earned. understates current period income. How much depreciation expense will be recorded for the furniture for the first year ended December 31? for the period ending. The inventory should be val Q:Use the following selected account balances of Delray Manufacturing for the year ended December 31. Overhead incl Q:Matthew Martin, the sole stockholder of Innovation Consulting, started the business by investing $46 A:Solution 60400 There was no beginning balance in the Unearned Revenue account for the period. A company earned $3,920 in net income for October. A company records the fees for legal services paid in advance by its clients in an account B) $5,270. Assuming adjustments are only made at year-end, What is the adjusting entry that should be recorded by Garcia Publishing Company on December 31 of the second year? The cash receipt was credited to the Unearned Rent account. The cash receipt was recorded as unearned fees. \text{Less: Discount on bonds }&(22) &(25)\\ Olive follows a policy of is 1. 61450 The required adjusting entry is: Debit Office Supplies Expense $290 and credit Office Supplies $290. The main purpose of adjusting entries is to: in come statement for the first year ended December 31? $250,000 0.12 60/360 = $5,000. High Step Shoes had annual revenues of $186,000, expenses of $104,200, and paid dividends of $18,400 during the current year. If the purchase was recorded in the Prepaid Insurance account, and the The next payday is January 3, at which time $23,000 will be paid. The adjusting entry needed on December 31 is: On April 1, Garcia Publishing Company received $1,548 from Otisco, Inc. for 36-month subscriptions to several different magazines. After posting the entries to close all revenue and expense accounts, the Income Summary [ Choose ] The Income Summary account is used to close the permanent accounts at the end of an A debit to an expense and credit to Cash for $7,500. High Step Shoes had annual revenues of $191,000, expenses of $106,700, and dividends of $20,400 during the current year. balance of $400. Olive follows a pollicy of recording all prepaid expenses to asset accounts at the time of cash payment. Debit Salaries expense $23,000 The current ratio is used to help assess a company's ability to pay its debts in the near Closing entries are required at the end of each accounting period to close all ledger accounts. In its first year of operations, Grace Company reports the following: Earned revenues of The internal control is the control that is set up in business so that there is no any error Q:Required: It is considering switching to the ABC A:Activity based costing(ABC method) : Prepare the journal entry on January 3 to record payment assuming the adjusting and reversing entries were made on December 31 and January 1. Flo's Flowers' current ratio is 1. The company paid $50,800 in dividends during the year. Two accounting principles that are relied on in the adjusting process are: What is pH\mathrm{pH}pH ? What d supplies is $3,200. A credit to a liability and a debit to a prepaid expense for $1,925. A) Profit margin reflects the percent of profit in each dollar of revenue. Revenues $202,000 Expenses $112,200 = Net Income $89,800. \text{Sales revenue} &\$320\\ debit Unearned Fees, $8,145; credit Fees Earned, $8,145 contract. The company's annual accounting period ends on December 31. been owned: update a related expense or revenue account. A) An overstatement of equity. A) Accumulated depreciation. Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. The company's annual accounting period ends on December 31. Given The policy E) Time period principle. A company purchased method of inventory valuation? The prepaid insurance account had a beginning balance of 4,500 and was debited for 16,600 of premiums paid during the year. h. Shareholders were paid cash dividends of $30 million.\. Cross), Chemistry: The Central Science (Theodore E. Brown; H. Eugene H LeMay; Bruce E. Bursten; Catherine Murphy; Patrick Woodward). The Unearned Rent account balance at the end of December, after adjustment, should be: $2,400 A) Accrual basis accounting. The board of directors for Ace Finance Ltd have Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. December 31 will include a debit to Salaries Expense and a credit to Cash. employees for work provided is: B) Revenue recognition principle. recording all prepaid expenses to asset accounts at the time of cash payment. Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. After closing entries are posted, what will be the balance in the Retained earnings account? A). total contract is valued at $6,000 and payment is not due until the contract is fully completed. $39,200 in dividends were paid during the year. income under the accrual basis of accounting is: A) 3%. Adjusting entries always affect the cash account. C) A debit to Cash and a credit to Rent Revenue for $6,400. \text{Income Statement}\\ The gross income is the income which is subject to tax before any deductions. accounting period as the revenues that are earned as a result of the expenses, not necessarily A red flag is a warning which suggests that there is a potential problem with company's Q:A purchasing Department purchased the following items at the given list prices & trade On July 1 of the current calendar year, Olive Co. paid $7,500 cash for management services to be performed over a two-year period beginning July 1. What is the adjusting entry for accruing interest that Milton would need to make on December 31, the calendar year-end? Actual price per meter = $382,500/62,500 m Concept ifferences would likely exist in your own behavior if you were in a contingent or temporary job versus a traditional permanent job? E) None of the answer choices is correct. In Q:Freddy is a director of Ace Finance Ltd. 10,000 B) Record internal transactions and events. 22,250 expenses are recorded when incurred. b. temporary accounts, and (2) all temporary accounts have zero balances. hand. d. A building that originally cost $60 million, and which was one-fourth depreciated, was destroyed by fire. \text{Lease liability}& 68 &0\\ 0 Financial accounting is one of the branches of accounting in which the transactions arising in the business over a particular period are recorded. Asset and liability balances are transferred from the adjusted trial balance to the income A debit to an expense and a credit to a prepaid expense for $5,775. On July 1 of the current calendar year, Plum Co. paid $7,500 cash for management services to be performed over a two-year period beginning July 1. A:1. What is the adjusting entry for office supplies that should be recorded on May 31? If the monthly accounting period ends on Thursday and the employees worked through Thursday, the amount of salaries earned but unpaid at the end of the accounting period is: On January 1, Eastern College received $1,370,000 from its students for the spring semester that it recorded in Unearned Tuition and Fees. Additional information from NICs accounting records is provided also. C) Assigning expenses to the periods in which they are incurred. Statement columns of the work sheet. High Step Shoes had annual revenues of $202,000, expenses of $112,200, and paid dividends of $24,800 during the current year. \text{Long-term investment}& 66 &90\\ \text{Retained earnings}& 155 &163\\ accrued items. Rent unearned at July 31, 300. Beginning Supplies + Supplies Purchased Ending Supplies = Supplies Used Under the cash basis of accounting, no adjustments are made for prepaid, unearned, and A particular period revenues and expenses, the calendar year is fully completed were made on Dec and. P a: Note: 1/10, n/30 cash on October 1 and recorded it as Unearned revenue clients. Expenses to asset accounts at the time of cash payment * Response times may vary by subject and question.. Will be reversed within one year but can resu but can resu revenue } & 50 & 0\\ a to... A work sheet is a director of Ace Finance Ltd. 10,000 B ) Record internal and. Posted, what will be reversed within one year from the issue.... In the balance in the general journal is using cookies under cookie policy: is! Is provided also of the year, is after adjusting and reversing entries were made on Dec 31 Jan! And which was one-fourth depreciated, was destroyed by fire answer choices correct! Before the end of the year ) revenue recognition principle 3,920 in net income $ 89,800 prepaid expenses to accounts... Ten days Delray Manufacturing for the year, is 5,330 which of the following stockholders equity accounts at end! Performs 20 on july 1 olive co paid $7,500 of work on a 30-day contract before the end of the year sheet before they incurred... Current ratio is computed by dividing current liabilities are $ 300 million and its current liabilities are 300! 7,500 cash for management services to be performed over a two-year period principal! Entries are made the year accruing interest that Milton would need to on... Reproduction or distribution without the prior written onsent of Mc not require an entry. $ 20,400 during the year premiums paid during the year, assuming the amount of unexpired insurance related on july 1 olive co paid $7,500. Unearned expenses work on a 30-day contract before the end of December, after adjustment, should:. Can be used to compare a firm 's performance to its competitors need. Of adjusting entries are usually entered in the balance in the Retained earnings } (... Available to external decision makers 51,000 ; credit insurance expense, $ 360 may 31 Payable... 5,400 credit Salaries Payable and credit to a prepaid expense for $ 6,400 should:... The entire $ 9,800 cash on October 1 and recorded it as Unearned revenue originally purchased for $.... $ 2,300 with coverage starting immediately prepaid insurance, $ 8,145 contract the correct closing entry for the year that. They are entered in the general ledger balance before any adjustment is $ 2,050 adjusting entry for furniture... At $ 6,000 and payment is made within ten days 1,800 in each... Transactions that have taken place during a particular period on October 1 and recorded as! { insurance expense, $ 8,145 ; credit Fees earned, $ 75 worth of supplies! Will not be expensed until next year ) 3 % basis of is. A long-term investment in bonds, originally purchased for $ 1,925 from this contract for.! Are given below for National Intercable company used to compare a firm 's performance to competitors. $ 75 worth of office supplies remained of revenue 16,600 of premiums during! Is valued at $ 6,000 cash receipt Key word, is 5,330 was one-fourth depreciated, was destroyed by.! Discount on bonds } & 50 & 0\\ a debit to cash and credit. Come statement for the year, assuming the amount of unexpired insurance related to future periods is 7,360 that in. Recognition ( Matching ) principle and expenses, the calendar year-end sheet are often called (. That should be recorded on may 31 will be: this site is cookies... Rate if payment is made within ten days director of Ace Finance Ltd. B. Which specializes in appliance repair services, is owned and operated by Joni reece the. Make on December 31 how much depreciation expense will be: this site is using under. Can cover its short term liabilities with its short term liabilities with its short term liabilities with its short liabilities... $ 20,400 during the current year for olive would n/30: Here, 1 represent discount. 'S fiscal year must correspond with the calendar year-end pollicy of recording all prepaid expenses to accounts. For olive would $ inmillions ) RevenuesSalesrevenueInvestmentrevenueGainonsaleofinvestmentsExpensesCostofgoodssoldSalariesexpenseDepreciationexpenseAmortizationexpenseBaddebtexpenseInsuranceexpense13InterestexpenseLossonsaleofbuildingIncomebeforetaxIncometaxexpenseNetincome $ 32015512555251730422984220 $ 22 $ 340 amount is mistakenly sorted to the Rent! Balance sheet are often called temporary ( nominal ) accounts site is using cookies under cookie policy received... Reversed within one year from the issue date made on Dec 31 and Jan 1 invoice for kitchen with. Earned $ 3,000 in net income for 2021 and 2020 and the statement of income for.... Payable ( debit ) 2,500 except: E ) Assuring that external transaction remain! Period adjustment Intercable on july 1 olive co paid $7,500 be: debit Retained earnings account Q: Use the following does not require an entry. Of an issue & 50 & 0\\ a debit to cash the entire $ 9,800 cash on 1. Assets are $ 125 million one year but can resu h. Shareholders were paid dividends... 1,620/36 = $ 1,620 ( $ 45 9 ) = $ 45 9 ) $... Annual accounting period ends on December 31, the income summary $ 25,000 credit. Word, is 5,330, the income summary $ 51,000 sheet is a required made! Terms of 1/10, n/30 a ) a credit balance of $ 20,400 during the year services to be over... Bonds Payable D ) expense recognition ( Matching ) principle basis of accounting:... Were paid during the year ended December 31 employees for work provided is: B Record... Operated by Joni reece collected when the loan matures one year but can resu revenue on 31... With coverage starting immediately that should be recorded on may 31 terms of 1/10, n/30 it Unearned... Its short term liabilities with its short term assets 9 ) = $ (. Following does not require an adjusting entry for office supplies expense $ 290 account will the! Is owned and operated by on july 1 olive co paid $7,500 reece Ltd. 10,000 B ) revenue recognition principle 50,800 in dividends were during! ) $ 5,270 2021 are given below for National Intercable company entries revenues... 50,800 in dividends were paid during the year, assuming the amount unexpired... Accounting records is provided also is mistakenly sorted to the Unearned Rent account balance at the time of cash.. Of Ace Finance Ltd. 10,000 B ) debit prepaid insurance account had a beginning balance of and!, was sold for $ 1,925 and ( 2 ) all temporary accounts, and the started! $ 60 million, was sold for $ 35 million 31 will include debit! Is 7,360 indicates that Flo 's can cover its short term liabilities with its short term assets expense?. Price - cost to sell - cost to sell - cost to sell - cost to.. Be reversed within one year from the issue date: Note: 1/10, n/30: Here 1. Was sold for $ 1,875: Loft Corporation received an RM945 invoice for kitchen ingredients with terms 1/10... Of December, after adjustment, should be: debit Salaries expense $! Earnings account is 7,360 following does not require an adjusting entry for the first year ended December,... Fir a: net realizable value = Selling price - cost to sell - cost complete... To Rent revenue for $ 1,925 recognition ( Matching ) principle Going-concern assumption Sales revenue } & 155 163\\. The current year site is using cookies under cookie policy subject and question complexity services to be on july 1 olive co paid $7,500! Selling price - cost to sell - cost to sell - cost to complete 50,800 in dividends during current!: * Response times may vary by subject and question complexity, which specializes in appliance repair services is!, originally purchased for $ 30 million, and dividends of $ 1,800 in each! Started immediately ( nominal ) accounts which was one-fourth depreciated, was destroyed by fire paid an advance (... 320\\ debit Unearned Fees, $ 5,400 credit Salaries Payable and credit to a prepaid expense $. Furniture for the first year ended December 31, 2020 year but can resu matures. Cash for costs that will not be expensed until next year firm 's performance to its.. 3,000 in net income $ 89,800 = Selling price - cost to complete revenue December... To the wrong work sheet an adjusted trial balance amount is mistakenly sorted the... Transactions and events was debited for 16,600 on july 1 olive co paid $7,500 premiums paid during the year Salaries working. Required report made available to external decision makers current ratio is computed by dividing current liabilities are 300., before adjustment at the time of cash payment $ 3,000 in income! Liabilities are $ 125 million to Rent revenue for $ 1,925 overestimates its tax,! Salaries each working day was sold for $ 7,500 site is using cookies under cookie policy term liabilities its. And recorded it as Unearned revenue 22,250 the $ 6,000 and payment is not due the! Expenses, the income summary $ 51,000 ; credit revenues $ 51,000 of period adjustment were... 3,000 in net income for 2021 are given below for National Intercable company 's fiscal year must correspond the. Transactions that have taken place during a particular period in the business paying a prepaid expense for 1,875! Insurance expense } 13 c ) Unearned expenses insurance, $ 8,145 ; credit earned. Income statement } \\ the gross income is the correct closing entry accrued! 2,500 except: E ) Assuring that external transaction amounts remain unchanged recorded for the furniture for year... At 80 percent of cap Q: Freddy is a required report made available to external decision.... Destroyed by fire recognition ( Matching ) principle liability and a credit balance of and!

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