Unformatted text preview: eres t rev enue Rent rev enue Wages ex pens e Debit $ 1,500 2,200 100 1,600 2,800 15,000 19,000 Credit $ 3,000 2,400 3,920 2,700 500 3,700 2,000 37,650 100 750 Learning Objective: 0405 Explain the closing process. Deprec iation ex pens e Utilities ex pens e Ins uranc e ex pens e Rent ex pens e Inc ome tax ex pens e Total 1,800 320 700 9,000 2,700 $ 56,720 $ 56,720 Prepare the c los ing entry on Dec ember 31, 2012. (Om it the "$" sign in your response.) General J ournal Debit
37,650 ± 0% 100 ± 0% 750 ± 0% 4,980 ± 0% Wages ex pens e 19,000 ± 0% Deprec iation ex pens e Utilities ex pens e Ins uranc e ex pens e Rent ex pens e Inc ome tax ex pens e 1,800 ± 0% 320 ± 0% 700 ± 0% 9,000 ± 0% 2,700 ± 0% Sales rev enue Interes t rev enue Rent rev enue Retained earnings Credit E4-6 Recording Seven T ypical Adjusting Entries LO2 [The following information applies to the questions displayed below.] Dittman's Variety Store is c ompleting the ac c ounting proc es s for the y ear jus t ended, Dec ember 31, 2011.
The trans ac tions during 2011 hav e been journaliz ed and pos ted. The following data with res pec t to
adjus ting entries are av ailable: a. Wages earned by employ ees during Dec ember 2011, unpaid and unrec orded at Dec ember 31, 2011,
amounted to $3,300. The las t pay roll was Dec ember 28; the nex t pay roll will be J anuary 6, 2012.
b. Offic e s upplies on hand at J anuary 1, 2011, totaled $520. Offic e s upplies purc has ed and debited to
Offic e Supplies during the y ear amounted to $650. The y earend c ount s howed $270 of s upplies on
c . Onefourth of the bas ement s pac e is rented to Heald's Spec ialty Shop for $610 per month, pay able
monthly . On Dec ember 31, 2011, the rent for Nov ember and Dec ember 2011 had not been c ollec ted or
rec orded. Collec tion is ex pec ted J anuary 10, 2012.
d. The s tore us ed deliv ery equipment that c os t $67,500; $12,300 was the es timated deprec iation for 2011.
e. On J uly 1, 2011, a twoy ear ins uranc e premium amounting to $3,120 was paid in c as h and debited in
full to Prepaid Ins uranc e. Cov erage began on J uly 1, 2011.
f. The remaining bas ement of the s tore is rented for $1,500 per month to another merc hant, M. Carlos ,
Inc . Carlos s ells c ompatible, but not c ompetitiv e, merc handis e. On Nov ember 1, 2011, the s tore
c ollec ted s ix months ' rent in the amount of $9,000 in adv anc e from Carlos ; it was c redited in full to
Unearned Rent Rev enue when c ollec ted.
g. Dittman's Variety Store operates a repair s hop to meet its own needs . The s hop als o does repairs for
M. Carlos . At the end of Dec ember 31, 2011, Carlos had not paid $770 for c ompleted repairs . This
amount has not y et been rec orded as Repair Shop Rev enue. Collec tion is ex pec ted during J anuary
Section Break E46 Recording Seven Typical Adjusting Entries LO2 9. awar d: 0.10 out of
0.10 points E4-6 Part 1
1. Identify eac h of the abov e trans ac tions as a deferred rev enue, deferred ex pens e, ac c rued rev enue, or
ac c rued ex p...
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