Log out Go to App
Go to App

Learning Materials

Features

Discover

Chapter 3: Q37PGA-2 (page 173)

Question :Greavy Theater Production Company’s partially completed worksheet as of December 31, 2018, follows. Adjustment data at December 31 follow: a. As of December 31, Greavy had performed \(500 of service revenue but has not yet billed customers. b. At the end of the month, Greavy had \)700 of office supplies remaining. c. Prepaid Insurance of \(3,900 remained. d. Depreciation expense, \)4,000. e. Accrued salaries expense of $200 that hasn’t been paid yet. Requirements 1. Complete the worksheet. Use letters a through e to label the five adjustments. 2. Journalize the adjusting entries.

Short Answer

Expert verified

Answer:

Worksheet is as follows:

GREAVY THEATER PRODUCTION COMPANY
WORKSHEET
December 31, 2018









Account NameUnadjusted Trial Balance
Adjustments

Adjusted Trial Balance



Debit
Credit

Debit

Credit
Debit
Credit

Cash

$4,300

$4,300

Accounts Receivable

5,900

(a)

$500

6,400

Office Supplies

1,900

$1,200

(b)

700

Prepaid Insurance

4,550

650

(c)

3,900

Equipment

30,000

30,000

Accumulated Depreciation—Equipment

$7,600

4,000

(d)

11,600

Accounts Payable

3,600

3,600

Salaries Payable

$200

(e)

200

Common Stock

21,950

21,950

Dividends

30,500

30,500

Service Revenue

77,000

500

(a)

77,500

Depreciation Expense—Equipment

(d)

4,000

4,000

Supplies Expense

(b)

1,200

1,200

Utilities Expense

5,500

5,500

Salaries Expense

27,500

(e)

200

27,700

Insurance Expense

(c)

650

650

Total

$110,150

$110,150

$6,550

$6,550

$114,850

$114,850

Step by step solution

01

Calculation of Supplies Expense

Supplies expense is calculated as follows:

SuppliesExpense=UnadjustedBalance-EndingBalance=$1,900-$700=$1,200

02

Calculation of Insurance Expense

Insurance expense is calculated as follows

InsuranceExpense=UnadjustedBalancePrepaidInsurance-EndingBalance=$4,550-$3,900=$650

Unlock Step-by-Step Solutions & Ace Your Exams!

  • Full Textbook Solutions

    Get detailed explanations and key concepts

  • Unlimited Al creation

    Al flashcards, explanations, exams and more...

  • Ads-free access

    To over 500 millions flashcards

  • Money-back guarantee

    We refund you if you fail your exam.

Start your free trial

Over 30 million students worldwide already upgrade their learning with Vaia!

One App. One Place for Learning.

All the tools & learning materials you need for study success - in one app.

Get started for free

Most popular questions from this chapter

Question :Consider the following situations: a. Business receives \(3,200 on January 1 for 10-month service contract for the period January 1 through October 31. b. Total salaries for all employees is \)3,600 per month. Employees are paid on the 1st and 15th of the month. c. Work performed but not yet billed to customers for the month is \(1,600. d. The company pays interest on its \)16,000, 4% note payable of $53 on the first day of each month. Assume the company records adjusting entries monthly. Journalize the adjusting entries needed as of January 31.

When is an adjusted trial balance prepared, and what is its purpose?

Question: Match the accounting terminology to the definitions. 3. Time period concept 4. Revenue recognition principle 5. Matching principle a. Requires companies to record revenue when it satisfies each performance obligation. b. Assumes that a business’s activities can be sliced into small time segments and that financial statements can be prepared for specific periods. c. Guides accounting for expenses, ensures that all expenses are recorded when they are incurred during the period, and matches those expenses against the revenues of the period

Question :At the beginning of the year, Modish Advertising owed customers \(2,100 for unearned revenue collected in advance. During the year, Modish received advance cash receipts of \)6,100 and earned \(20,000 of service revenue (exclusive of any amount earned from advance payments). At year-end, the liability for unearned revenue is \)3,100 and unadjusted service revenue is $20,000. Requirements 1. Record the adjusting entry assuming that Modish records the cash receipt of unearned revenue by initially crediting a liability account. Post the adjusting entry to the Unearned Revenue and Service Revenue T-accounts. Make sure to include the beginning balance and additional unearned revenue in the Unearned Revenue T-account. 2. Record the adjusting entry assuming that Modish records the cash receipt of unearned revenue by initially crediting a revenue account. Post the adjusting entry to the Unearned Revenue and Service Revenue T-accounts. Make sure to include the beginning balance in the Unearned Revenue T-account and the additional unearned revenue in the Service Revenue T-account. 3. Compare the ending balances of the T-accounts under both approaches. Are they the same?

Question :The unadjusted trial balance for All Mopped Up Company, a cleaning service, is as follows:ALL MOPPED UP COMPANY Unadjusted Trial Balance December 31, 2018 Account Title Prepaid Insurance Cash Debit Credit Office Supplies Equipment Accumulated Depreciation—Equipment Accounts Payable Salaries Payable Unearned Revenue Common Stock Dividends Service Revenue Salaries Expense Supplies Expense Depreciation Expense—Equipment Insurance Expense Total Balance \( 800 \) 45,400 \( 45,400 \) 2,000 15,300 25,000 2,000 600 30,000 2,400 700 5,000 7,000 A, During the 12 months ended December 31, 2018, All Mopped Up: a. used office supplies of \(1,700. b. used prepaid insurance of \)580. c. depreciated equipment, \(500. d. accrued salaries expense of \)310 that hasn’t been paid yet. e. earned $400 of unearned revenue. Requirements 1. Open a T-account for each account using the unadjusted balances. 2. Journalize the adjusting entries using the letter and December 31 date in the date column. 3. Post the adjustments to the T-accounts, entering each adjustment by letter. Show each account’s adjusted balance.
See all solutions

Recommended explanations on Business Studies Textbooks

Business Case Studies

Read Explanation

Corporate Finance

Read Explanation

Intermediate Accounting

Read Explanation

Managerial Economics

Read Explanation

Business Development

Read Explanation

Organizational Behavior

Read Explanation
View all explanations

What do you think about this solution?

We value your feedback to improve our textbook solutions.

Study anywhere. Anytime. Across all devices.

Sign-up for free