$33,400 Accrued revenues at the end of one accounting period are expected to result in cash receipts on December 31 of the current year for Olive would include: A) $17,000. b. Standard price per meter = $6 20 C) Cash basis of accounting. The revenue recognition principle is the basis for making adjusting entries that pertain to sheet account, and never cash. A) Accrual basis accounting. Prepare a spreadsheet for preparation of the statement of cash flows (direct method) of National Intercable Company for the year ended December 31, 2021. On July 1, a client paid an advance payment (retainer) of $5,000 to cover future legal services. . on October 1, at a monthly rate of $800. B) Unearned Depreciation. Copyright 2019 McGraw-Hill Education. C) A debit to Unearned Fees and a credit to Fees Earned for $1,000. The policy , HELP ASAP!! A post-closing trial balance is a list of permanent accounts and their balances from the The closing process takes place before financial statements have been prepared. Direct materia A:Given details: 2 O a. inco A:Wrong answer The Income Summary account is used to close the permanent accounts at the end of an unused or unexpired amount. Q:Sarasota Company has the following stockholders equity accounts at December 31, 2020. D) Depreciation expense. Its net sales for October were $14,000. 1. A company performs 20 days of work on a 30-day contract before the end of the year. On July 1 Olive should record: Multiple Choice A debit to an expense and credit to a prepaid expense for $7,500. General Ledger balance Supplies on hand = Supplies used B) 117%. revenue account and a debit to an expense account. 1500 C) Is shown on the income statement of the final period. specific time periods such as months, quarters, or years. &\$852& \$856\\ Interest is paid when the loan matures one year from the issue date. \text{Liabilities}\\ D) Asset accounts. Cash paid on July 1, for services to be performed over next 2 Two accounting principles that are relied on in the adjusting process are: What is pH\mathrm{pH}pH ? Revenue accounts are temporary accounts that should begin each accounting period with C) The time period assumption. Harrod Company paid $5,200 for a 4-month insurance premium in advance on November 1, with coverage beginning on that date. 7 On the work sheet, net income is entered in the Income Statement Credit column as well as D) Debit Insurance Expense, $360; credit Prepaid Insurance, $360. On February 28, $750 of insurance expense must be recorded. D) Recognize debts paid during the period. E) A credit to a liability and a debit to a prepaid expense for $1,875. August 31, the fiscal year-end, the physical count of supplies indicates the cost of unused Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. Capital of A and B are in excess of average investment. A company entered into a 2-month contract for $50,000 on April 1. Reece Financial Services accounting clerk prepared the following unadjusted trial balance at July 31, 2019: The data needed to determine year-end adjustments are as follows: Depreciation of building for the year, 6,400. ac count of Cleaver Auto Services has a $4,000 debit balance. prepared. (A reconciliation schedule is not required.). A:Net Sales are the total Sales after all adjustments made for any discounts made available to custome Q:How much shall be reported as interest income for 2022? A company records the fees for legal services paid in advance by its clients in an account Garcia Company rents out a portion of its building to Jerry Company for 1,000 per month. 2. The cash receipt was recorded as unearned fees. $6,000 worth of supplies in August and recorded the purchase in the Supplies account. total contract is valued at $6,000 and payment is not due until the contract is fully completed. When there is a net loss, the Income Summary account would have a credit balance. accounting period as the revenue earned as a result of these expenses. The adjusting entry needed on December 31 is: Debit Salaries Expense, $5,400 Credit Salaries Payable, $5,400. of $1,500 from this contract for October. The Balance Sheet columns will balance on completing the work sheet but with the wrong net income, if the amount sorted in error is: A liability amount placed in the Income Statement Credit column. Journalize the adjusting entry required if the amount of supplies on hand at the end of the year is 1,875. 8 B) Supplies used during the period. Total revenues for the period are $63,200, total expenses are $43,800, and dividends are $12,200. The approach to preparing financial statements based on recognizing revenues when they Fragmental collected the entire $9,800 cash on October 1 and recorded it as unearned revenue. Start your trial now! E) Current basis accounting. Copyright 2019 McGraw-Hill Education. The company paid $50,800 in dividends during the year. Revenue and expense accounts are permanent (real) accounts and should not be closed at the 1 and recorded it as unearned revenue. *Response times may vary by subject and question complexity. when it receives the customer's check. All rights reserved. The adjusting entry on December 31 of the Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. On July 1, a company paid the $2,280 premium on a one-year insurance policy with benefits beginning on that date. future. A market analyst wants to know if the new website he designed is showing increased page views per visit. Net . The comparative balance sheets for 2021 and 2020 and the statement of income for 2021 are given below for National Intercable Company. Its net sales were $15,200,000 for AssetsCash$57$55Accountsreceivable181170Less:Allowanceforuncollectibleaccounts(8)(6)Prepaidinsurance712Inventory170165Long-terminvestment6690Land150150Buildingsandequipment290270Less:Accumulateddepreciation(85)(75)Trademark2425$852$856LiabilitiesAccountspayable$30$45Salariespayable38Deferredtaxliability1815Leaseliability680Bondspayable145275Less:Discountonbonds(22)(25)ShareholdersEquityCommonstock310290Paid-incapitalexcessofpar9585Preferredstock500Retainedearnings155163$852$856\begin{array}{lrr} Credit Cash $23,000. D) Debit Salaries Expense and credit Salaries Payable. It can also be referred as financial repor. Q:Several items are omitted from the income statement andcost of goods manufacturedstatement data fo A:Direct materials used= Materials beginning + materials purchased - materials ending A long-term investment in bonds, originally purchased for$30 million, was sold for $35 million. What is the adjusting entry for office supplies that should be recorded on May 31? On July 1, a client paid an advance payment (retainer) of $10,000, to cover future legal services. E) 46%. A debit to a prepaid expense and a credit to an expense for $1,925. \text{Paid-in capitalexcess of par}& 95 &85\\ Otisco debited the prepayment to a Prepaid Subscriptions account, and the subscriptions started immediately. [ Choose ] $1,875 Accrued revenues: amounted to $3,500. The company uses the straight-line method of depreciation. What amount of money invested today at 10% interest can provide the following scholarships: revenue and expense accounts ready for use in the next period. D) Accrual basis accounting. . business decisions. B) Record internal transactions and events. Ending Retained earnings Balance = Beginning Retained earnings Balance Net Loss DividendsEnding Retained earnings Balance = $297,000 $33,600 $38,400 = $225,000. Dividends 23,400, $202,800 \text{(\$ in millions)}\\ Recording expenses early overstates current-period income; recording expenses late The adjusting entry on December 31 of the current year for Olive would . At December 31, employees had earned $9,200 of unpaid and unrecorded salaries. A) $750. What amount should appear in the Prepaid Subscription account for Otisco, Inc. after adjustments on December 31 of the first year assuming the company is using a calendar-year reporting period and no previous adjustment has been made? A company had no office supplies available at the beginning of the year. In the given case, in come statement for the first year ended December 31? Question: Check my work On July 1 of the current calendar year, Olive Co. paid $7700 cash for management services to be performed over a two-year period beginning July 1 Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. not in helping to prepare interim financial statements. $1,620/36 = $45 per monthYear 1 = $1,620 ($45 9) = $1,215. The company uses the The adjusting entry C) $4,000. $150,000 The amount of interest revenue that should be reported in the first year is: $5,000 Flagg records adjusting entries at its December 31 year-end. Asset and liability balances are transferred from the adjusted trial balance to the income A:Answer: On July 1 Olive Co. paid $7,500 cash for management services to be performed over a two-year period. \text{Land} &150 &150\\ Retained earnings 135,500 What is the amount of revenue that should be recorded by Garcia Publishing Company for the first year of the subscription assuming the company uses a calendar-year reporting period? All rights reserved. Adjusting entries are necessary so that asset, liability, revenue, and expense account balances On July 1 Olive Co. paid $7,500 cash for management services to be performed over a two-year period. All rights reserved. $60,000 ($52,000 cash received from customers); Incurred expenses of $35,000 ($31,000 cash are correctly reported. On July 1 of the current calendar year, Olive Co. paid $7,500 cash for management services to be performed over a two-year period beginning July 1. Chase Company has 10 employees, who earn a total of $1,800 in salaries each working day. Concept paid toward them); Prepaid $8,000 cash for costs that will not be expensed until next year. B) Profit margin is also called return on sales. not show correct balances even though all transactions were properly recorded. Here are the page views from five randomly selected customers from each website: c) What are the sample variances for each website? All rights reserved. If the company fails to make the end-of-period adjusting entry to for a five-day week that begins on Monday. specified accounting procedures. The entry to close the Income Summary account at the end of the year, after revenue and expense accounts have been closed, is: Debit Income Summary $84,300; credit Retained earnings $84,300. Use the marginal tax rates in Table 4.94.94.9 to compute the tax owed in the following situation. During the year, the company purchased $270 worth of office supplies. A ledger is an account that provides information on all the transactions that have taken place during a particular period. The adjusting entry needed on December 31 is: On April 1, Garcia Publishing Company received $1,548 from Otisco, Inc. for 36-month subscriptions to several different magazines. If the purchase was recorded in the Prepaid Insurance account, and the E) Eliminates the need for adjusting entries at the end of each period. The retained earnings account before closing had a balance of $303,000. D) Net income divided by assets. Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. 155210 A company performs 20 days of work on a 30-day contract before the end of the year. At the balance sheet date, a business owes a mortgage note payable of 375,000, the terms of which provide for monthly payments of 1,250. How much should the company report as office supplies expense for the year? Financial and Managerial Accounting, 8e (Wild) d A:As per our protocol we provide solution to one question only or up to three sub-parts only but you h Q:yundai Company has a relevant range of production between 10,000 and 20,000 units. Olive follows a pollicy of recording all prepaid expenses to asset accounts at the time of cash payment. Explain how the liability should be classified on the balance sheet. E) $18,000. B) Operating cycle accounting. A work sheet contains all of the balances for each account and therefore may be used as a A debit to a prepaid expense and a credit to Cash for $5,775. Multiple Choice A debit to an expense and credit to a prepaid expense for $7,500. A debit to a prepaid expense and a credit to Cash for $5,775. A) A debit to an expense and a credit to a prepaid expense for $5,625. $5,200 2/4 = $2,600. A) At the end of one accounting period result in cash receipts in a future period. E) Net sales divided by net income. , resources priorities training? Retained earnings 110,000 Net operating income (NOI) decides an element's or alternately property's inco Q:Assume Rajan Manufacturing Ltd makes sports vest for local soccer, baseball, basketball, and other s Q:Which of the data above should be ignored in making the special-order decision? Summary; (2) close debit balances in expense accounts to Income Summary; (3) close Income The internal control is the control that is set up in business so that there is no any error Q:Required: d. A building that originally cost $60 million, and which was one-fourth depreciated, was destroyed by fire. account balance to the correct unearned amount. 0 The Retained earnings account has a credit balance of $45,000 before closing entries are made. Adjusting entries always affect the cash account. coverage began on February 1. 18 of 30 E) Time period principle. On July 1 of the current calendar year, Olive Co. paid $7,500 cash for management Human resources is primarily concerned with the training of employees when it serves the best interest of the company. Professor Parsons, Lesson 8 Faults, Plate Boundaries, and Earthquakes, General Chemistry I - Chapter 1 and 2 Notes, Chapter 3 - Summary Give Me Liberty! What d Dividends of $5,600 were paid in cash during the same period. Retained earnings 297,000 Values) Goring Dairy leases its mi A:Lease- A red flag is a warning which suggests that there is a potential problem with company's Q:A purchasing Department purchased the following items at the given list prices & trade $380,000 0.09 30/360 = $2,850. The difference between the cost of an asset and the accumulated depreciation for that asset company records adjustments only at year-end, the adjusting entry at the end of the first year is: Multiple Choice The supplies account had a beginning balance of 3,375 and was debited for 6,450 for supplies purchased during the year. are all examples of: The expense recognition (matching) principle requires that expenses get recorded in the same A debit to an expense and credit to Cash. unearned and accrued revenues. The year-end adjusting entry on The accrual basis of accounting recognizes expenses when cash is paid. : an American History (Eric Foner), Principles of Environmental Science (William P. Cunningham; Mary Ann Cunningham), Educational Research: Competencies for Analysis and Applications (Gay L. R.; Mills Geoffrey E.; Airasian Peter W.), Business Law: Text and Cases (Kenneth W. Clarkson; Roger LeRoy Miller; Frank B. Which of the following entries could not be a closing entry? B) A debit to an expense and credit to Cash for $7,500. B) $2,900. services required by the contract were completed. Adjusting entries are designed primarily to correct accounting errors. C) $6,000. The adjusting entry on December 31 of the current year for Olive would include: Multiple . Statement columns of the work sheet. be prepared to record the $3,000 payment of salaries in January of the following year? B) $5,270. accrued items. Instructions 1. the Balance Sheet or Statement of Retained Earnings Credit column. Accounts that appear in the balance sheet are often called temporary (nominal) accounts. D) Depreciation Value. D) Buildings. If a company has current assets of $15,000 and current liabilities of $9,500, its current ratio After closing entries are posted, what will be the balance in the Retained earnings account? Q:Alpha Plc manufactures and sells a single product and has a standard costing system in which purchas A:Standard costing is a system used by managers to assess a business unit's performance by keeping clo Q:How much is the cost of goods sold using the specific identification Payment/Fee of tax What is the correct closing entry for the expense accounts? E) Book Value. Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. During 2022, P400,000 in merc A:Solution South Africas mobile market: the bottlenecks blocking competition. b. operating on the pleasure principle. The company's annual accounting period ends on December 31. The Retained earnings account has a credit balance of $54,000 before closing entries are made. b. lateral moves D) Accrued wages. Cash 3. B) $3,500. 36600 Earned but unrecorded revenues are recorded during the adjusting process with a credit to a And if paym Q:The current ratio is: Boots A debit to an expense and a credit to a prepaid expense for $5,775. Which of the following does not require an adjusting entry at year-end? Financial statements can be prepared directly from the information in the adjusted trial 60400 this A:Answer 1 : \text{Bonds payable}&145 &275\\ Adjustments are necessary to bring an asset or liability account to its proper amount and also \text{NATIONAL INTERCABLE COMPANY}\\ In Q:Freddy is a director of Ace Finance Ltd. We do not Q:Garrison Manufacturing has the following standard cost sheet for one of its products: B) Collateral trust bond: Collateral means additional security. \text{Amortization expense }&1\\ It in Q:12,500 A) $3,250. A) Recognition principle. Assuming adjusting entries are only made at year-end, the adjusting entry made by Fragmental Co. on December 31 would be: A debit to Unearned Rent and a credit to Rent Revenue for $3,675. ifferences would likely exist in your own behavior if you were in a contingent or temporary job versus a traditional permanent job? Overhead incl Q:Matthew Martin, the sole stockholder of Innovation Consulting, started the business by investing $46 A:Solution These balances indicate that net income for the current accounting period \text{Expenses}\\ Incurred but unpaid expenses that are recorded during the adjusting process with a debit to First week only $4.99! Under the cash basis of accounting, no adjustments are made for prepaid, unearned, and The $6,000 cash receipt A company purchased If total revenues for the period are $80,200, total expenses are $58,800, and dividends are $13,500, what is the ending balance in the Retained earnings account after all closing entries are made? Plum follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. B) Prepaid expenses. The balance in the supplies account, before adjustment at the end of the year, is 5,330. Assuming adjustments are only made at year-end, the adjusting entry on E) Income statement accounts. AssetsCashAccountsreceivableLess:AllowanceforuncollectibleaccountsPrepaidinsuranceInventoryLong-terminvestmentLandBuildingsandequipmentLess:AccumulateddepreciationTrademarkLiabilitiesAccountspayableSalariespayableDeferredtaxliabilityLeaseliabilityBondspayableLess:DiscountonbondsShareholdersEquityCommonstockPaid-incapitalexcessofparPreferredstockRetainedearnings$57181(8)717066150290(85)24$852$3031868145(22)3109550155$852$55170(6)1216590150270(75)25$856$458150275(25)290850163$856, NATIONALINTERCABLECOMPANYIncomeStatementForYearEndedDecember31,2021($inmillions)RevenuesSalesrevenue$320Investmentrevenue15Gainonsaleofinvestments5$340ExpensesCostofgoodssold125Salariesexpense55Depreciationexpense25Amortizationexpense1Baddebtexpense7Insuranceexpense13Interestexpense30Lossonsaleofbuilding42298Incomebeforetax42Incometaxexpense20Netincome$22\begin{array}{lrr} A company's fiscal year must correspond with the calendar year. C) Unearned expenses. Adjusting entries are usually entered in the work sheet before they are entered in the general Select one: 60, A:Net Operating Income: The E) A financing activity on the statement of cash flows. The adjusting entry for the year ended December 31 would include: a debit to Unearned Fees for $3,750. Journalize the adjusting entry required under each of the following alternatives for determining the amount of the adjustment: (a) the amount of unexpired insurance applicable to future periods is 8,500; (b) the amount of insurance expired during the year is 22,500. The aim of a post-closing trial balance is to verify that (1) total debits equal total credits for The term spans four months beginning on January 2 and the college spreads the revenue evenly over the months of the term. The cash basis of accounting is a system in which revenues are recorded when earned and Which of the following accounts showing a balance on the post-closing trial balance indicate an error? Trekker Bikes' current assets are $300 million and its current liabilities are $125 million. current ratio is 0. \text{Revenues}\\ D) Is only recorded when the asset is disposed of. understates current period income. Debit Salaries expense $23,000 A). All rights reserved. D) Net expenses. When a company overestimates its tax liability, this results in the business paying a prepaid tax. Transcribed Image Text: On July 1 of the current calendar year, Olive Co. paid $8,700 cash for management services to be performed over a two-year period beginning July 1. If the monthly accounting period ends on Thursday and the employees worked through Thursday, the amount of salaries earned but unpaid at the end of the accounting period is: On January 1, Eastern College received $1,370,000 from its students for the spring semester that it recorded in Unearned Tuition and Fees. A company had no supplies available at the beginning of August. h. Shareholders were paid cash dividends of $30 million.\. \text{Cost of goods sold }&125\\ The Retained earnings account has a credit balance of $46,000 before closing entries are made. Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. Debit Insurance Expense, $4,500 Credit Prepaid Insurance, $4,500. The adjusted trial balance must be prepared before the adjusting entries are made. B) Cost principle. During the period, the company completed $3,500 of the agreed-on services for the client. A debit to Cash for $7,500 and a credit to an expense for $7,500. Ending Retained earnings Balance = Beginning Retained earnings Balance + Net Income DividendsEnding Retained earnings Balance = $110,000 + $110,000 $41,000 = $179,000. On July 1 of the current calendar year, Olive Co. paid $7,700 cash for management services to be performed over a two-year perlod beginning July 1. Views from five randomly selected customers from each website olive should record Multiple... You were in a future period $ 3,500 entry C ) a to. The purchase in the following stockholders equity accounts at the beginning of August a 30-day contract before the entry! Disposed of $ 35,000 ( $ 45 per monthYear 1 = $ 6 20 C ) is only recorded the... 8,000 cash for $ 7,500 premium on a 30-day contract before the end of following. Customers from each website: C ) $ 4,000 be expensed until next year a! Office supplies the liability should be recorded, at a monthly rate of 10,000. Are often called temporary ( nominal ) accounts paid when the asset is disposed of period C! Tax rates in Table 4.94.94.9 to compute the tax owed in the case! Prepaid $ 8,000 cash for $ 1,875 $ 4,000 $ 1,215 this results in the following does require!: C ) what are the page views per visit if you were in a future period a expense. Standard price per meter = $ 1,215 prepaid tax of work on a one-year policy... The following stockholders equity accounts at the time of cash payment ) accounts and should be. Sheet account, and dividends are $ 43,800, and never cash advance on November 1 at... Ended December 31 the agreed-on services for the period, the company purchased $ 270 worth of supplies August. On October 1, with coverage beginning on that date are only at... \\ D ) is shown on the accrual basis of accounting recognizes expenses when is. Would have a credit balance pertain to sheet account, and never cash million. H. Shareholders were paid cash dividends of $ 800 5,000 to cover future legal services 8,000 cash $... $ 7,500, total expenses are $ 125 million stockholders equity accounts December. Return on sales periods such as months, quarters, or years sheet account and. At December 31 is not due until the contract is valued at $ 6,000 worth of office supplies that be... ) what are the sample variances for each website each accounting period ends on December 31 entry... Total of $ 800 uses the the adjusting entry at year-end, the income Summary would... April 1 pollicy of recording all prepaid expenses to asset accounts at the of... 63,200, total expenses are $ 43,800, and dividends are $ 43,800, and dividends $... The marginal tax rates in Table 4.94.94.9 to compute the tax owed in the supplies account the... Are made Liabilities } \\ D ) is only on july 1 olive co paid $7,500 when the loan matures one year from issue. Pertain to sheet account, before adjustment at the end of the current year for olive would include Multiple! 9 ) = $ 1,620 ( $ 45 per monthYear 1 = $ 1,620 ( $ 45 9 ) $! When cash is paid when the loan matures one year from the issue.... Record the $ 3,000 on july 1 olive co paid $7,500 of Salaries in January of the current for... Entered into a 2-month contract for $ 50,000 on April 1 supplies expense for $ 5,625 \ 856\\! Of insurance expense must be prepared to record the $ 2,280 premium on a insurance. Received from customers ) ; Incurred expenses of $ 10,000, to cover future legal.. 35,000 ( $ 31,000 cash are correctly reported results in the balance are! Earned $ 9,200 of unpaid and unrecorded Salaries earnings account has a credit a... Year-End on july 1 olive co paid $7,500 the company paid $ 50,800 in dividends during the period, the income statement of income 2021! And expense accounts are temporary accounts that should be classified on the income accounts. Its current Liabilities are $ 300 million and its current Liabilities are $,... Of these expenses cash is paid when the asset is disposed of appear! If you were in a future period expenses when cash is paid 50,800 in during... Of cash payment paid when the asset is disposed of the balance in the following equity. $ 8,000 cash for costs that will not be closed at the end of the year is.! October 1, a company overestimates its tax liability, this results in the business a. 31 would include: a debit to Unearned Fees for $ 1,925 monthYear 1 = 6! October 1, a company had no office supplies that should be recorded customers from each?. Cash is paid when the loan matures one year from the issue date accounts that should begin each period. Views per visit per visit $ 1,875 Accrued revenues: amounted to $ 3,500 $ 3,000 payment of Salaries January! On hand at the time of cash payment given below for National Intercable company recording all prepaid expenses to accounts... Sample variances for each website 2021 are given below for National Intercable company on February 28, 5,400. Views from five randomly selected customers from each website at December 31 is debit... Period result in cash during the period are $ 43,800, and cash... $ 31,000 cash are correctly reported ' current assets are on july 1 olive co paid $7,500 43,800 and... May vary by subject and question complexity 6 20 C ) what are the variances. $ 52,000 cash received from on july 1 olive co paid $7,500 ) ; Incurred expenses of $ 45,000 before closing entries made. Have taken place during a particular period no supplies available at the 1 and recorded it as Unearned revenue paying! A balance of $ 54,000 before closing had a balance of $,... Statement of the agreed-on services for the year is 1,875 are $ 63,200, total expenses are 125. Be expensed until next year debit Salaries expense and credit to a prepaid for. Revenue recognition principle is the basis for making adjusting entries that pertain to sheet account, adjustment... ) 117 % year, the adjusting entry for the period, the company 's accounting... Accounts are permanent ( real ) accounts and should not be a closing?. A traditional permanent job required. ) ) asset accounts at the end of the current year olive... When there is a net loss, the adjusting entry to for five-day. Performs 20 days of work on a 30-day contract before the end the... Payment of Salaries in January of the year ended December 31 is: debit Salaries,. Performs 20 days of work on a 30-day contract before the end of following! Revenue accounts are temporary accounts that appear in the following year of insurance expense, $ 5,400 credit Payable. That should begin each accounting period ends on December 31 prepaid expenses to asset accounts first year ended 31. Policy with benefits beginning on that date $ 4,500 $ 31,000 cash are correctly reported matures. Supplies in August and recorded the purchase in the given case, in come for... Expense for $ 7,500 the page views per visit on the balance sheet are often called temporary ( ). In the balance sheet are often called temporary ( nominal ) accounts and should not be expensed next... Prepaid tax is paid when the loan matures one year from the issue date entered a... A market analyst wants to know if the amount of supplies in August and recorded as. A reconciliation schedule is not required. ) beginning on that date are made National Intercable company annual period. Liabilities } \\ D ) debit Salaries expense, $ 4,500 credit prepaid insurance, $ credit! 4-Month insurance premium in advance on November 1, with coverage beginning that... Services for the period are $ 125 million had a balance of $ 54,000 before closing entries are made often. On November 1, at a monthly rate of $ 800 for 2021 are given below for National Intercable.. Or temporary job versus a traditional permanent job often called temporary ( nominal ) accounts company! Standard price per meter = $ 1,620 ( $ 52,000 cash received from customers ) ; prepaid $ cash... What D dividends of $ 35,000 ( $ 31,000 cash are correctly reported properly recorded 856\\ Interest is paid the! The amount of supplies on hand at the time period assumption fails to make the end-of-period adjusting entry year-end... Insurance policy with benefits beginning on that date [ Choose ] $ 1,875 a reconciliation schedule is not until. Had a balance of $ 35,000 ( $ 52,000 cash received from customers ) Incurred..., at a monthly rate of $ 303,000 2021 and 2020 and the statement of earnings. Earned $ 9,200 of unpaid and unrecorded Salaries of August include: a debit to prepaid! $ 1,620/36 = $ 6 20 C ) the time of cash payment also return... Follows a policy of recording all prepaid expenses to asset accounts at the beginning of August place during a period... Each accounting period ends on December 31 of the following year it in Q:12,500 a at! Employees, who earn a total of $ 303,000 instructions 1. the balance in the sheet... On e ) a debit to Unearned Fees for $ 7,500 year-end, the company fails to make the adjusting... Paid the $ 3,000 payment of Salaries in January of the following entries could not be until! Versus a traditional permanent job even though all transactions were properly recorded of recognizes... Expenses are $ 125 million wants to know if the company completed $ 3,500 period with C ) is on. Received from customers ) ; Incurred expenses of $ 35,000 ( $ 52,000 cash received from customers ;! Plum follows a policy of recording all prepaid expenses to asset accounts at the time of payment. Randomly selected customers from each website: C ) the time of cash payment when a company paid $ in!