Revenue 41 fees earned 42 rent revenue 5 expenses 51

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Unformatted text preview: Office Equipment 54 Utilities Expense 55 Supplies Expense 56 Insurance Expense 59 Miscellaneous Expense NetSolutions Expanded Chart of Accounts Statement of Financial Position 1. Assets 11 Cash 12 Accounts Receivable 14 Supplies 15 Prepaid Insurance 17 Land 18 Office Equipment 19 Accumulated Depreciation – Office Equipment 2. 21 22 23 Liabilities Accounts Payable Salaries Payable Unearned Rent 3. Owner’s Equity 31 Chris Chee, Capital 32 Chris Chee, Drawing Statement of Comprehensive Income 4. Revenue 41 Fees Earned 42 Rent Revenue 5. Expenses 51 Salaries Expense 52 Rent Expense 53 Depreciation Expense – Office Equipment 54 Utilities Expense 55 Supplies Expense 56 Insurance Expense 59 Miscellaneous Expense Adjustments – Deferrals and Accruals Adjustments – Deferrals and Accruals Adjustments Revenues Current Period Future Period Deferrals Cash Received Revenue Recorded Adjustments – Deferrals and Accruals Adjustments – Deferrals and Accruals Adjustments Revenues Current Period Future Period Deferrals Cash Received Revenue Recorded Accruals Revenue Recorded Cash Received Adjustments – Deferrals and Accruals Adjustments – Deferrals and Accruals Adjustments Revenues Current Period Future Period Deferrals Cash Received Revenue Recorded Accruals Revenue Recorded Cash Received Current Period Future Period Expenses Deferrals Cash Paid Expense Recorded Adjustments – Deferrals and Accruals Adjustments – Deferrals and Accruals Adjustments Revenues Accruals Deferrals Expenses Accruals Deferrals Current Period Future Period Revenue Recorded Cash Received Cash Received Current Period Revenue Recorded Future Period Expense Recorded Cash Paid Cash Paid Expense Recorded Adjusting entries Journal entries that bring the accounts up to date at the end of the month/year. Items that require adjusting entries: •accruals •deferrals •provision for depreciation Adjusting entries Adjusting Accruals • Accrued Revenue • Accrued Expense Accrued Revenue • Also called accrued asset. • Examples: Fees earned on account. • Revenues that have been earned but have not been recorded in the accounts • These items require adjustments at the end of the month/year. Adjustments – Accrued Revenue Adjustments – Accrued Revenue Adjustments As at Dec 31, NetSolutions had provided $500 of services to customer. NetSolutions will only invoice and collect from the customer in January. However NetSolutions earned the revenue in December. The adjusting entry, Dr Accounts Receivable Cr Fees Earned 500 500 Adjusting entries – Accrued Revenue Adjusting entries – Accrued Revenue Statement of Financial Position as at Dec 31 Current Asset Accounts Receivable 500 Statement of Comprehensive Income For the year ended Dec 31 Fees earned 500 Accrued Expense • Also called accrued liabilities • Expenses that have been incurred but have not been recorded in the accounts. • These items require adjustments at the end of the month/year. Adjustments – Accrued...
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