Continued next page Cambridge Business Publishers 2015 Solutions Manual Module

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Continued next page © Cambridge Business Publishers, 2015 Solutions Manual, Module 3 3-53
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P3-48. concluded b. Note:Only those T-accounts required are shown here. Accounts Payable Prepaid Advertising 2,700 Bal. Bal. 1,680 1,540 1. 645 7. Accumulated Depreciation Equipment Supplies 5,280 2. Bal. 6,270 4,750 5. Interest Payable Advertising Expense 450 6. 1. 1,540 Depreciation Expense Rent Expense 2. 5,280 Bal. 6,900 7. 645 Wages Payable Wages Expense 2,400 4. Bal. 38,80 0 4. 2,400 Utilities Payable Utilities Expense 325 3. Bal. 3,020 3. 325 Supplies Expense Interest Expense 5. 4,750 6. 450 © Cambridge Business Publishers, 2015 3-54 Financial & Managerial Accounting for MBAs, 4 th Edition
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P3-49. (35 minutes) a. DATE DESCRIPTION DEBIT CREDIT Mar. 31 Rent Expense 795 Prepaid Rent 795 To record March rent expense($4,770/6 months = $795). Mar. 31 Supplies Expense 2,340 Supplies 2,340 To record March supplies expense($3,700 $1,360 = $2,340). Mar. 31 Depreciation Expense—Equipment 335 Accumulated Depreciation—Equipment 335 To record March depreciation($36,180/108 months = $335). Mar. 31 Wages Expense 1,560 Wages Payable 1,560 To record unpaid wages at March 31. Mar. 31 Utilities Expense 390 Accounts Payable 390 To record estimated March utilitiesexpense. Mar. 31 Unearned Service Revenue 500 Service Revenue 500 To record portion of revenue received in advance that was earned in March. © Cambridge Business Publishers, 2015 Solutions Manual, Module 3 3-55
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P3-49. continued b. Only the affected T-accounts are included here. The closing entries required in part d are referenced by 1d, 2d etc. Accounts Payable Prepaid Rent 3,510 Bal. Bal. 4,770 795 1. 390 5. Bal. 3,975 3,900 Bal. Acc Depreciation - Equipment Supplies 335 3. Bal. 3,700 2,340 2. 335 Bal. Bal. 1,360 Service Revenue Unearned Service Revenue 1d. 12,860 12,360 Bal. 6. 500 1,000 Bal. 500 6. 500 Bal. Depreciation Expense Rent Expense 3. 335 335 3d. 1. 795 795 6d. Utilities Expense Supplies Expense 5. 390 390 5d. 2. 2,340 2,340 2d. Wages Payable Wages Expense 1,560 4. Bal. 3,900 4. 1,560 5,460 4d. Retained Earnings 12,860 1d. 2d. 2,340 3d. 335 4d. 5,460 5d. 390 6d. 795 3,540 Bal. Continued next page © Cambridge Business Publishers, 2015 3-56 Financial & Managerial Accounting for MBAs, 4 th Edition
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P3-49. continued c. WYSOCKI WHEELS Income Statement For Month Ended March 31 Service revenues .................................................................................................... $12,860 Expenses Utilities expense ................................................................................................ $390 Supplies expense ............................................................................................. 2,340 Wage expense .................................................................................................. 5,460 Depreciation expense ....................................................................................... 335 Rent expense .................................................................................................... 795 9,320 Net income ............................................................................................................. $3,540 WYSOCKI WHEELS Balance Sheet March 31 Cash .......................................... $2,900 Wages payable ........................................ $1,560 Accounts receivable ................... 3,820 Accounts payable ................................... 3,900 Prepaid rent ............................... 3,975 Unearned service revenue ....................... 500 Supplies ..................................... 1,360 Total liabilities .......................................... 5,960 Equipment, cost ......................... 36,180 Less accumulated depreciation. (335 ) Common stock ......................................... 38,400 Equipment, net .......................... 35 ,845 Retained earnings ................................... 3 ,540 Total assets ................................ $47 ,900 Total liabilities and equity ......................... $47 ,900 d. 1d. Service Revenue ............................................................................... 12,860 Retained Earnings ...................................................................... 12,860 2d. Retained Earnings ............................................................................. 1,360 Supplies Expense ....................................................................... 1,360 3d. Retained Earnings ............................................................................. 335 Depreciation Expense ................................................................. 335 4d. Retained Earnings ............................................................................. 5,460 Wages Expense .......................................................................... 5,460 5d. Retained Earnings ............................................................................. 390 Utilities Expense ......................................................................... 390 6d. Retained Earnings ............................................................................. 795 Rent Expense ............................................................................. 795 The closing journal entries are shown in the T- accounts above.
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