Practice Problems - Module 4

Practice Problems - Module 4 - Practice Problems Module 4...

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Unformatted text preview: Practice Problems Module 4 Introduction to Financial Accounting in the 21 st Century © Gaber, Hayes & Porporato 2011 1 Practice problems module 4 Practice Problems Module 4 Introduction to Financial Accounting in the 21 st Century © Gaber, Hayes & Porporato 2011 2 Practice Problem 1: Adjusting Entries Elaine Carpet Cleaners ended its first month of operations on June 30 of the current year. The unadjusted account balances are as follows: Elaine Carpet Cleaners Trial Balance June 30,19XX Debit Credit Cash $ 800 Accounts Receivable 400 Prepaid Rent 1,200 Supplies on Hand 900 Equipment 5,400 Accounts Payable $ 500 Elaine, Capital 6,000 Elaine, Drawing 300 Service Fees 3,200 Wages Expense 700 11700 12,700 The following information is also available: (1) The balance in Prepaid Rent was the amount paid on June 1 for the first three months' rent. (2) Supplies on hand at June 30 were $540. (3) The equipment, purchased June 1, has an estimated life of six years. (4) Unpaid wages at June 30 were $200. (5) Utility services used during June were estimated at $165. A bill is expected early in July. (6) Fees earned for services performed but not yet billed on June 30 were $300. REQUIRED In general journal form, make the adjusting entries needed at June 30. Practice Problems Module 4 PRACTICE PROBLEM 2 – TRIAL BALANCE AND ADJUSTMENTS The Ali, Inc., a commercial photography studio, has just completed its first full year of operations on December 31 of the current year. The general ledger account balances before year-end adjustments follow. No adjusting entries have been made to the accounts at any time during the year. Assume that all balances are normal. Cash ……………………..$1,400 Unearned Photography Fees $ 1,150 Accounts Receivable……… 2,200 Capital Stock …………..…..10,000 Prepaid Rent ………..………7,740 Photography Fees……. 20,900 Supplies on Hand…… 3,650 Wages Expense……… 6,000 Equipment…………… 8,640 Insurance Expense….. 1,930 Accounts Payable…… 1,820 Utilities Expense……. 2,310 An analysis of the firm's records discloses the following items: (1) Photography services of $600 have been rendered, but customers have not yet been billed....
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This note was uploaded on 01/23/2012 for the course ADMS 2500 taught by Professor Warner during the Spring '08 term at York University.

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Practice Problems - Module 4 - Practice Problems Module 4...

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