Homework SourseSelected account balances before adjustment for Intuit Realt
Selected account balances before adjustment for Intuit Realty at November 30, the end of the current year, follow:
Data needed for year-end adjustments are as follows:
Required:
Supplies on hand at November 30, $510.
Depreciation of equipment during year, $850.
Rent expired during year, $5,220.
Wages accrued but not paid at November 30, $1,650.
Unearned fees at November 30, $3,290.
Unbilled fees at November 30, $3,920.
1. Journalize the six adjusting entries required at November 30, based on the data presented.
2. What would be the effect on the income statement if the adjustments for equipment depreciation and unearned fees were omitted at the end of the year? Enter all amounts as positive numbers.
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| Debits | Credits | |||
| Accounts Receivable | $56,780 | |||
| Equipment | 88,000 | |||
| Accumulated Depreciation - Equipment | $8,740 | |||
| Prepaid Rent | 7,200 | |||
| Supplies | 1,700 | |||
| Wages Payable | _ | |||
| Unearned Fees | 7,840 | |||
| Fees Earned | 331,600 | |||
| Wages Expense | 111,860 | |||
| Rent Expense | _ | |||
| Depreciation Expense | _ | |||
| Supplies Expense | _ |
Solution
1) Journal Entries ;
2) Income statement :
| DAte | Accounts Titles and explanation | Debit $ | Credit $ |
| Nov 30 | Supplies Expense | 1190 | |
| Supplies | 1190 | ||
| (1700 - 510) | |||
| Nov 30 | Depreciation | 850 | |
| Acc. Depreciation - equipment | 850 | ||
| Nov 30 | Rent Exp. | 5220 | |
| Prepaid Rent | 5220 | ||
| Nov 30 | Wages expense | 1650 | |
| Wages payable | 1650 | ||
| Nov 30 | Unearned Fees | 4550 | |
| Fees earned | 4550 | ||
| (7840 - 3290) | |||
| Nov 30 | Accounts Receivable | 3920 | |
| Fees Earned | 3920 |
