Posting LO 4 Record transactions in journals post to ledger accounts and

Posting lo 4 record transactions in journals post to

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Posting LO 4 Record transactions in journals, post to ledger accounts, and prepare a trial balance. A business transaction has not occurred. There is only an agreement between Pioneer Advertising and the newspaper for the services to be performed in November. Therefore, no journal entry is necessary in October.
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3-30 8. October 20: Pioneer Advertising’s board of directors declares and pays a $5,000 cash dividend to stockholders. Cash 5,000 Dividends 5,000 Oct. 20 Debit Credit Cash 100,000 5,000 Debit Credit Dividends Posting 12,000 9,000 6,000 5,000 LO 4 Record transactions in journals, post to ledger accounts, and prepare a trial balance.
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3-31 LO 4 9. October 26: Employees are paid every four weeks. The total payroll is $2,000 per day. The pay period ended on Friday, October 26, with salaries and wages of $40,000 being paid. Cash 40,000 Salaries and Wages Expense 40,000 Oct. 26 Debit Credit Cash 100,000 40,000 Debit Credit Salaries and Wages Expense Posting 12,000 9,000 6,000 5,000 40,000
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3-32 10. October 31: Pioneer Advertising receives $28,000 in cash and bills Copa Company $72,000 for advertising services of $100,000 performed in October. Accounts Receivable 72,000 Cash 28,000 Oct. 31 Debit Credit Cash 100,000 72,000 Debit Credit Accounts Receivable 12,000 9,000 6,000 5,000 40,000 Service Revenue 100,000 100,000 Debit Credit Service Revenue 28,000 80,000 Posting
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3-33 Trial Balance A list of each account and its balance; used to prove equality of debit and credit balances. Trial Balance LO 4 Illustration 3-19
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3-34 Adjusting Entries LO 5 Explain the reasons for preparing adjusting entries and identify major types of adjusting entries. Makes it possible to: Report on the balance sheet the appropriate assets, liabilities, and owner’s equity at the statement date. Report on the income statement the proper revenues and expenses for the period. Revenues are recorded in the period in which services are performed. Expenses are recognized in the period in which they are incurred.
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3-35 Types of Adjusting Entries 1. Prepaid Expenses. Expenses paid in cash before they are used or consumed. Deferrals 3. Accrued Revenues. Revenues for services performed but not yet received in cash or recorded. 4. Accrued Expenses. Expenses incurred but not yet paid in cash or recorded. 2. Unearned Revenues. Cash received before services are performed. Accruals Illustration 3-20 LO 5 Explain the reasons for preparing adjusting entries and identify major types of adjusting entries.
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3-36 Deferrals are either prepaid expenses or unearned revenues . Adjusting Entries for Deferrals Illustration 3-21 LO 5
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3-37 Prepaid Expenses. Assets paid for and recorded before a company uses them. Adjusting Entries for Prepaid Expenses insurance supplies advertising Cash Payment Cash Payment Expense Recorded Expense Recorded BEFORE rent buildings and equipment Prepayments often occur in regard to: LO 5 Explain the reasons for preparing adjusting entries and identify major types of adjusting entries.
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3-38 Supplies . Pioneer Advertising purchased advertising supplies costing $25,000 on October 5. Prepare the journal entry to record the purchase of the supplies.
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