EXERCISES 13 From the following independent adjustment items

EXERCISES -13. From the following independent adjustment items at calendar year- sent adjusting journal entries. Show computations in good form. (Use account titles which you think are appropriate undert A. Accrued payroll of office personnel, P415. B. Accrued interest on notes: pg 35

Solution

A. Dr. Salary P415

Cr. Salary Payable P415

(being liability for payment of accrued salary booked)

B1. Dr. Interest expense P1500

Cr. Interest payable P1500

=50000*12%*90/360

(being interest expense booked)

B2. Dr. Interest Receivable P1000

Cr. Interest Income P1000

=100000*6%*60/360

(being interest income booked)

C. Dr. Service Income P50000

Cr. Advance for services P50000

(being advance booked under sales reversed.)

D. Dr. unearned service income P42000

Cr. Service income P42000

=(70000*60%)

(being income recorded on being earned)

E. Dr. E Derji Capital Account P100000

Cr. Salaries P100000

(being drawings erroneously charged to salaries rectified)

F. Dr Cash P90

Cr Telephone expenses P90

(being expenses overbooked by P90 rectified)

G.Dr. Stock of office supplies P375

Cr. office supplies P375

(being unused stock of supplies recorded)

H. Dr Prepaid Insurance P1500

Cr. Insurance P1500

= 6000*3/12

(being prepaid insurance booked)

I. Dr. Depreciation P12850

Cr. Accumulated Depreciation P12850

(being depreciation charged)

=50000*12%*90/360 (being interest expense booked)