APTER 3 Adjusting the Accounts Instructions For each of the above items indicate the following. a. The type of adjustment (prepaid expense, unearned revenue, accrued revenue, or accrued expense). b. The status of accounts before adjustment (overstatement or understatement). djusting entries from E3.7 (LO 2, 3) The ledger of Passehl Rental Agency on March 31 of the current year includes the se- lected accounts, shown below, before adjusting entries have been prepared. ccount data. Debit Credit Prepaid Insurance Supplies Equipment $ 3,600 2,800 25,000 Accumulated Depreciation-Equipment Notes Payable $ 8,400 20,000 10,200 Unearned Rent Revenue Rent Revenue 60,000 Interest Expense Salaries and Wages Expense -0- 14,000 An analysis of the accounts shows the following. 1. The equipment depreciates $400 per month. 2. One-third of the unearned rent revenue was earned during the quarter. 3. Interest of $500 is accrued on the notes payable. 4. Supplies on hand total $750. 5. Insurance expires at the rate of $300 per month. Instructions Prepare the adjusting entries at March 31, assuming that adjusting entries are made quarterly. Addi- tional accounts are Depreciation Expense, Insurance Expense, Interest Payable, and Supplies Expense. E3.8 (LO 2, 3) Lorena Manzone, D.D.S., opened a dental practice on January 1, 2020. During the first month of operations, the following transactions occurred. ljusting entries. 1. Performed services for patients who had dental plan insurance. At January 31, $785 of such services were performed but not yet recorded. 2. Utility expenses incurred but not paid prior to January 31 totaled $650, 3. Purchased dental equipment on January 1 for $80,000, paying $30,000 in cash and signing a $50,000, 3-year note payable. The equipment depreciates $400 per month. Interest is $500 per month. 4. Purchaseda one-year malpractice insurance policy on January 1 for $24,000 5. Purchased $1,600 of dental supplies. On January 31, determined that $400 of supplies were on hand Instructions Prepare the adjusting entries on January 31. Account titles are Accumulated Depreciation-Equipment, Depreciation Expense, Service Revenue, Accounts Receivable, Insurance Expense, Interest Expense, Interest Payable, Prepaid Insurance, Supplies, Supplies Expense, Utilities Expense, and Utilities Payable. E3.9 (LO 2, 3) The trial balance for Pioneer Advertising is shown in Illustration 3.3. Instead of the ad- justing entries shown in the textbook at October 31, assume the following adjustment data. usting entries. 1. Supplies on hand at October 31 total $500. 2. Expired insurance for the month is $120. 3. Depreciation for the month is $50. 4. Services related to unearned service revenue in October worth $600 were performed. 5. Services performed but not recorded at October 31 are $360. 6. Interest accrued at October 31 is $95. 7. Accrued salaries at October 31 are $1,625 Instructions Prepare the adjusting entries for the items above.

APTER 3 Adjusting the Accounts Instructions For each of the above items indicate the following. a. The type of adjustment (prepaid expense, unearned revenue, accrued revenue, or accrued expense). b. The status of accounts before adjustment (overstatement or understatement). djusting entries from E3.7 (LO 2, 3) The ledger of Passehl Rental Agency on March 31 of the current year includes the se- lected accounts, shown below, before adjusting entries have been prepared. ccount data. Debit Credit Prepaid Insurance Supplies Equipment $ 3,600 2,800 25,000 Accumulated Depreciation-Equipment Notes Payable $ 8,400 20,000 10,200 Unearned Rent Revenue Rent Revenue 60,000 Interest Expense Salaries and Wages Expense -0- 14,000 An analysis of the accounts shows the following. 1. The equipment depreciates $400 per month. 2. One-third of the unearned rent revenue was earned during the quarter. 3. Interest of $500 is accrued on the notes payable. 4. Supplies on hand total $750. 5. Insurance expires at the rate of $300 per month. Instructions Prepare the adjusting entries at March 31, assuming that adjusting entries are made quarterly. Addi- tional accounts are Depreciation Expense, Insurance Expense, Interest Payable, and Supplies Expense. E3.8 (LO 2, 3) Lorena Manzone, D.D.S., opened a dental practice on January 1, 2020. During the first month of operations, the following transactions occurred. ljusting entries. 1. Performed services for patients who had dental plan insurance. At January 31, $785 of such services were performed but not yet recorded. 2. Utility expenses incurred but not paid prior to January 31 totaled $650, 3. Purchased dental equipment on January 1 for $80,000, paying $30,000 in cash and signing a $50,000, 3-year note payable. The equipment depreciates $400 per month. Interest is $500 per month. 4. Purchaseda one-year malpractice insurance policy on January 1 for $24,000 5. Purchased $1,600 of dental supplies. On January 31, determined that $400 of supplies were on hand Instructions Prepare the adjusting entries on January 31. Account titles are Accumulated Depreciation-Equipment, Depreciation Expense, Service Revenue, Accounts Receivable, Insurance Expense, Interest Expense, Interest Payable, Prepaid Insurance, Supplies, Supplies Expense, Utilities Expense, and Utilities Payable. E3.9 (LO 2, 3) The trial balance for Pioneer Advertising is shown in Illustration 3.3. Instead of the ad- justing entries shown in the textbook at October 31, assume the following adjustment data. usting entries. 1. Supplies on hand at October 31 total $500. 2. Expired insurance for the month is $120. 3. Depreciation for the month is $50. 4. Services related to unearned service revenue in October worth $600 were performed. 5. Services performed but not recorded at October 31 are $360. 6. Interest accrued at October 31 is $95. 7. Accrued salaries at October 31 are $1,625 Instructions Prepare the adjusting entries for the items above.

College Accounting, Chapters 1-27

23rd Edition

ISBN:9781337794756

Author:HEINTZ, James A.

Publisher:HEINTZ, James A.

Chapter16: Accounting For Accounts Receivable

Section: Chapter Questions

Problem 8SPB: UNCOLLECTIBLE ACCOUNTSALLOWANCE METHOD Lewis Warehouse used the allowance method to record the...

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