Homework SourseAdjusting Entries Round to two decimal places 27 The rent p
| Adjusting Entries - Round to two decimal places. | |
| 27. | The rent payment made on June 17 (3600 )was for June and July. Expense the amount associated with one month\'s rent. |
| 28. | A physical inventory showed that only $259.00 worth of office supplies remained on hand as of June 30. |
| 29. | The annual interest rate on the mortgage payable was 9.00 percent. Interest expense for one-half month should be computed because the building and land were purchased and the liability incurred on June 16. |
| 30. | Record a journal entry to reflect that one half month\'s insurance has expired. |
| 31. | A review of Byte’s job worksheets show that there are unbilled revenues in the amount of $5,625.00 for the period of June 28-30. |
| The fixed assets have estimated useful lives as follows: | |
| Building - 31.5 years | |
| Computer Equipment - 5.0 years | |
| 32. | Office Equipment - 7.0 years |
| Use the straight-line method of depreciation. Management has decided that assets purchased during a month are treated as if purchased on the first day of the month. The building’s scrap value is $500.00. The office equipment has a scrap value of $350.00. The computer equipment has no scrap value. Calculate the depreciation for one month. | |
| 33. | A review of the payroll records show that unpaid salaries in the amount of $531.00 are owed by Byte for three days, June 28 - 30. Ignore payroll taxes. |
| 34. | The note payable to Royce Computers (transactions 04 and 07) is a five-year note, with interest at the rate of 12 percent annually. Interest expense should be computed based on a 360 day year. |
| Closing Entries | |
| 35. | Close the revenue accounts. |
| 36. | Close the expense accounts. |
| 37. | Close the income summary account. |
| 38. | Close the withdrawals account. |
| Adjusting Entries - Round to two decimal places. | |
| 27. | The rent payment made on June 17 (3600 )was for June and July. Expense the amount associated with one month\'s rent. |
| 28. | A physical inventory showed that only $259.00 worth of office supplies remained on hand as of June 30. |
| 29. | The annual interest rate on the mortgage payable was 9.00 percent. Interest expense for one-half month should be computed because the building and land were purchased and the liability incurred on June 16. |
| 30. | Record a journal entry to reflect that one half month\'s insurance has expired. |
| 31. | A review of Byte’s job worksheets show that there are unbilled revenues in the amount of $5,625.00 for the period of June 28-30. |
| The fixed assets have estimated useful lives as follows: | |
| Building - 31.5 years | |
| Computer Equipment - 5.0 years | |
| 32. | Office Equipment - 7.0 years |
| Use the straight-line method of depreciation. Management has decided that assets purchased during a month are treated as if purchased on the first day of the month. The building’s scrap value is $500.00. The office equipment has a scrap value of $350.00. The computer equipment has no scrap value. Calculate the depreciation for one month. | |
| 33. | A review of the payroll records show that unpaid salaries in the amount of $531.00 are owed by Byte for three days, June 28 - 30. Ignore payroll taxes. |
| 34. | The note payable to Royce Computers (transactions 04 and 07) is a five-year note, with interest at the rate of 12 percent annually. Interest expense should be computed based on a 360 day year. |
| Closing Entries | |
| 35. | Close the revenue accounts. |
| 36. | Close the expense accounts. |
| 37. | Close the income summary account. |
| 38. | Close the withdrawals account. |
Solution
SOLUTION:
Income statement
Revenues
Computer & Consulting Revenue
$22,370.00
Exp.enses
Rent Exp.
$2,400.00
Salary Exp.
$2,236.00
Advertising Exp..
$350.00
Repair and Maint. Exp..
$1,190.00
Oil & Gas Exp.
$840.00
Supplies Exp.
$371.00
Interest Exp.
$1,489.00
Insurance Exp.
$235.00
Depreciation Exp.
$3,909.11
Total
$13,020.11
Net Income Before Tax
$13,020.11
Income Tax Exp..
$2,337.47
Net Income After Tax
10682.64
Retained Earnings
Amount
Opening Balance
$180,444.00
Plus: Net Income
$10,682.64
$191,126.64
Minus: Dividends
$1,886.46
Closing Balance
$189,240.18
?
| Transaction | Date | Account | Particulars | Debit | Credit |
| 27 | 42551 | 5010 | Rent Exp. | $2,400.00 | |
| 42551 | 1140 | Prepaid Rent | $2,400.00 | ||
| 28 | 42551 | 5080 | Supplies Exp. | $371.00 | |
| 42551 | 1150 | Office Supplies | $371.00 | ||
| 29 | 42551 | 5090 | Interest Exp. | $393.00 | |
| 42551 | 2103 | Interest Payable | $393.00 | ||
| 30 | 42551 | 5100 | Insurance Exp. | $235.00 | |
| 42551 | 1130 | Prepaid Insurance | $235.00 | ||
| 31 | 42551 | 1120 | Accounts Receivable | $5,750.00 | |
| 42551 | 4100 | Computer & Consulting Revenue | $5,750.00 | ||
| 32 | 42551 | 5110 | Depreciation Exp. | $3,909.11 | |
| 42551 | 1212 | Accum. Depr.-Office Equip. | $18.62 | ||
| 42551 | 1312 | Accum. Depr.-Computer Equip. | $3,618.00 | ||
| 42551 | 1412 | Accum. Depr.-Building | $272.49 | ||
| 33 | 42551 | 5020 | Salary Exp. | $516.00 | |
| 42551 | 2105 | Salaries Payable | $516.00 | ||
| 34 | 42551 | 5090 | Interest Exp. | $1,096.00 | |
| 42551 | 2103 | Interest Payable | $1,096.00 | ||
| 35 | 42551 | 5120 | Income Tax Exp. | $2,337.47 | |
| 42551 | 2106 | Income Taxes Payable | $2,337.47 | ||
| 36 | 42551 | 4100 | Computer & Consulting Revenue | $22,370.00 | |
| 36 | 42551 | 3400 | Income Summary | $22,370.00 | |
| 37 | 42551 | 3400 | Income Summary | $15,357.58 | |
| 42551 | 5010 | Rent Exp. | $2,400.00 | ||
| 42551 | 5020 | Salary Exp. | $2,236.00 | ||
| 42551 | 5030 | Advertising Exp. | $350.00 | ||
| 42551 | 5040 | Repairs & Maint. Exp. | $1,190.00 | ||
| 42551 | 5050 | Oil & Gas Exp. | $840.00 | ||
| 42551 | 5080 | Supplies Exp. | $371.00 | ||
| 42551 | 5090 | Interest Exp. | $1,489.00 | ||
| 42551 | 5100 | Insurance Exp. | $235.00 | ||
| 42551 | 5110 | Depreciation Exp. | $3,909.11 | ||
| 42551 | 5120 | Income Tax Exp. | $2,337.47 | ||
| 38 | 42551 | 3400 | Income Summary | $7,012.42 | |
| 42551 | 3200 | Retained Earnings | $7,012.42 | ||
| 39 | 42551 | 3200 | Retained Earnings | $1,886.46 | |
| 42551 | 3300 | Dividends | $1,886.46 |
