70.2K

Verified Solution

Link Copied!

Problem 3-2A Preparing adjusting and subsequent journal entries LO P1, P2, P3, P4 Amez Company's annual accounting period ends on December 31, 2019. The foliowing information concerns the adjusting entries to be recorded as of that date. 0. The Office Supplies account started the year with a $4.225 balance. During 2019, the company purchased supplies for $17.449. which was added to the Office Supplies account. The inventory of supplies available at December 31, 2019, totaled $3,718. b. An analysis of the company's insurance policies provided the following facts The total premium for each policy was paid in full (fot all months) at the purchase date, and the Prepaid insurance account was debited for the full cost. (Year-end adjusting entries for Prepaid insurance were properly recorded in all prior years) c. The company has 15 employees, who earn a total of $2,850 in salaries each working day. They are paid each Monday for their work in the five-day workweek ending on the previous Friday. Assume that December 31,2019 , is a Tuesday, and all 15 employees worked the first two days of that week. Because New Year's Day is a paid holiday, they will be paid salaries for five full days on Monday, January 6,2020 d. The company purchased a buliding on January 1, 2019. It cost $675,000 and is expected to have a $45,000 salvage value at the end of as predicted 25-year life. Annual depreciation is $25,200 e. Since the company is not large enough to occupy the entire building it owns, it rented space to a tenant at $3,100 per month, starting on November 1, 2019 . The rent was paid on time on November 1, and the amount received was credited to the Rent Earned account. However, the tenant has not paid the December rent. The company has worked out an agreement with the tenant, who has promised to pay both December and January rent in full on January 15 . The tenant has agreed not to fall behind again. f. On November 1, the company rented spoce to another tenant for $2,809 per month. The tenant paid five months' rent in advance on that date. The payment was recorded with a credit to the Unearned Rent account. Assume no other adjusting entries are made during the year. Required: 1. Use the information to prepare adjusting entries as of December 31,2019. 2. Prebare lournal entries to record the first subsecuent cosh transaction in 2020 for parts c and e. Use the information to prepare adjusting entries as of December 31,2019. Journal entry worksheet The Office Supplies account started the year with a $4,225 balance. During 2019 , the company purchased supplies for $17,449, which was added to the office Supplies account. The inventory of supplies available at December 31 , 2019 , totaled $3,718. Note: Enter debits before credits. Journal entry worksheet 4 Record the adjusting entry related to the company's insurance. Note: Enter debits before credits. Journal entry worksheet The company has 15 employees, who earn a total of $2,850 in salaries each working day. They are paid each Monday for their work in the five-day workweek ending on the previous Friday. Assume that December 31, 2019, is a Tuesday, and all 15 employees worked the first two days of that week. Because New Year's Day is a paid holiday, they will be paid salaries for five full Note: Enter debits before credits. Journal entry worksheet 1 2 The company purchased a building on January 1, 2019. It cost $675,000 and is expected to have a $45,000 salvage value at the end of its predicted 25 : year life. Annual depreciation is $25,200. Note: Enter debits before credits. Journal entry worksheet 123 "Since the companny is not large enougn to "occupy the entire binding it owns, it rented space to a tenant at $3,100 per month, starting on November 1, 2019. The rent was paid on time on November 1 , and the amount received was credited to the Rent Earned account. However, the tenant has not paid the December rent. The company has worked out an agreement with the tenant, Note: Enter debits before credits. Journal entry worksheet 123 credited to the Rent Eamed account. However, the tenant has not paid the December rent. The company has worked out an agreement with the tenant, who has promised to pay both December and January rent in full on January 15. The tenant has agreed not to fall behind again. Note: Enter debits before credits. Journal entry worksheet

Answer & Explanation Solved by verified expert

See Answer