The geological consulting firm of Gilbert, Marsh, & Kester prepares adjusting entries on a monthly basis. Among the items requiring adjustment on December year are the following:
The company has out standing a $ percent, year note payable issued on July year Payment of the $ note, plus all accrued interest for the year loan period, is due in full on June year
The firm is providing consulting services to Texas Oil Company at an agreedupon rate of $ per day. At December days of unbilled consulting services have been provided.
Required:
a Prepare the two adjusting entries required on December to record the accrued interest expense and the accrued consulting revenue earned.
b Assume that the $ note payable plus all accrued interest are paid in full on June year What portion of the total interest expense associated with this note will be reported in the firm's year income statement?
c Assume that on January year Gilbert, Marsh, & Kester receive $ from Texas Oil Company in full payment of the consulting services provided in December and January. What portion of this amount constitutes revenue earned in January?
