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Unformatted text preview: E3-8Correct. (Adjusting Entries)Andy Roddick is the new owner of Ace Computer Services. At the end of August 2007, his first month of ownership, Roddick is trying to prepare monthly financial statements. Below is some information related to unrecorded expenses that the business incurred during August. 1.At August 31, Roddick owed his employees $1,900 in wages that will be paid on September 1.2.At the end of the month he had not yet received the month's utility bill. Based on past experience, he estimated the bill would be approximately $600.3.On August 1, Roddick borrowed $30,000 from a local bank on a 15-year mortgage. The annual interest rate is 8%.4.A telephone bill in the amount of $117 covering August charges is unpaid at August 31. InstructionsPrepare the adjusting journal entries as of August 31, 2007, suggested by the information above. DescriptionDebitCredit1.Wages Expense1900 Wages Payable1900 (To record wages payable at 8/31.)2.Utilities Expense600 Accounts Payable600 (To record utility expense for August.)3.Interest Expense200 Interest Payable...
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This note was uploaded on 04/26/2010 for the course ACCT 320 taught by Professor Son during the Spring '10 term at Morgan.
- Spring '10