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Chapter 3: Q47PS (page 181)

This problem continues the Crystal Clear Cleaning situation from Chapter 2. Start from the unadjusted trial balance that Crystal Clear Cleaning prepared at November 30, 2018:

Crystal Clear Cleaning

Unadjusted Clear Cleaning

November 30, 2018

Balance

Account Title

Debit

Credit

Cash

\( 51,650

Accounts Receivables

4,000

Cleaning Supplies

320

Prepaid Rent

4,000

Prepaid Insurance

4,800

Equipment

5,400

Truck

3,000

Accounts Payable

\) 1,245

Unearned Revenue

15,000

Notes Payable

36,000

Common Stock

18,000

Dividends

1,400

Service Revenue

5,100

Salaries Expense

400

Advertising Expense

200

Utilities Expense

175

Total

\( 75,345

\) 75,345

Consider the following adjustment data:

a. Cleaning supplies on hand at the end of November were \(50.

b. One month’s combined depreciation on all depreciable assets was estimated to be \)150.

c. One month’s interest expense is $59.

Requirements

1. Using the data provided from the trial balance, the previous adjustment information, and the information from Chapter 2, prepare all required adjusting journal entries at November 30.

2. Prepare an adjusted trial balance as of November 30 for Crystal Clear Cleaning.

Short Answer

Expert verified

Adjusted trail balance matched at $75,854

Step by step solution

01

Recording of journal entry

Date

Particular

Debit

Credit

a.

Supplies Expense

$ 270

Cleaning supplies

$ 270

Being supplies expense incurred

b.

Depreciation Expense

150

Accumulated Depreciation

150

Being depreciation incurred

c.

Interest expense

59

Accrued Interest

59

02

Adjusted trial balance

Crystal Clear Cleaning

Unadjusted Clear Cleaning

November 30, 2018

Balance

Account Title

Debit

Credit

Cash

$ 51,650

Accounts Receivables

4,000

Cleaning Supplies

50

Prepaid Rent

4,000

Prepaid Insurance

4,800

Equipment

5,400

Truck

3,000

Accounts Payable

$ 1,245

Unearned Revenue

15,000

Notes Payable

36,000

Common Stock

18,000

Dividends

1,400

Service Revenue

5,100

Salaries Expense

400

Advertising Expense

200

Utilities Expense

175

Supplies Expense

270

Depreciation Expense

150

Accumulated Depreciation

150

Interest Expense

59

Accrued Interest

59

Total

$ 75,554

$ 75,554

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Most popular questions from this chapter

Question :The unadjusted trial balance of Anniston Air Purification System at December 31, 2018, and the data needed for the adjustments followANNISTON AIR PURIFICATION SYSTEM Unadjusted Trial Balance December 31, 2018 Adjustment data at December 31 followAccount Title Prepaid Rent Cash Debit Credit Accounts Receivable Office Supplies Equipment Accumulated Depreciation—Equipment Accounts Payable Salaries Payable Unearned Revenue Common Stock Dividends Service Revenue Salaries Expense Rent Expense Depreciation Expense—Equipment Advertising Expense Supplies Expense Total Balance \( 7,600 \) 69,000 \( 69,000 22,000 43,800 3,100 15,300 19,700 2,900 1,800 \) 3,900 2,900 9,900 3,300 1,800 a. On December 15, Anniston contracted to perform services for a client receiving \(3,100 in advance. Anniston recorded this receipt of cash as Unearned Revenue. As of December 31, Anniston has completed \)2,100 of the services. b. Anniston prepaid two months of rent on December 1. (Assume the Prepaid Rent balance as shown on the unadjusted trial balance represents the two months of rent prepaid on December 1.) c. Anniston used \(750 of office supplies. d. Depreciation for the equipment is \)850. e. Anniston received a bill for December’s online advertising, \(1,100. Anniston will not pay the bill until January. (Use Accounts Payable.) f. Anniston pays its employees on Monday for the previous week’s wages. Its employees earn \)3,500 for a five-day workweek. December 31 falls on Wednesday this year. g. On October 1, Anniston agreed to provide a four-month air system check (beginning October 1) for a customer for $3,400. Anniston has completed the system check every month, but payment has not yet been received and no entries have been made. Requirements 1. Journalize the adjusting entries on December 31. 2. Using the unadjusted trial balance, open the T-accounts with the unadjusted balances. Post the adjusting entries to the T-accounts. 3. Prepare the adjusted trial balance. 4. How will Anniston Air Purification System use the adjusted trial balance?

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.

Question:Seth’s Tax Services had the following accounts and account balances after adjusting entries. Assume all accounts have normal balances.Cash Land Accounts Payable Utilities Payable Accumulated Depreciation—Equipment Service Revenue Supplies Expense Dividends \( ? 26,000 150 3,700 1,800 75,000 1,100 14,000 Equipment Accounts Receivable Common Stock Office Supplies Utilities Expense Unearned Revenue Depreciation Expense—Equipment Salaries Expense \) 11,000 4,950 700 22,600 1,650 900 1,900 5,600Prepare the adjusted trial balance for Seth’s Tax Services as of December 31, 2018.

Question :The accounting records of Mackay Architects include the following selected, unadjusted balances at March 31: Accounts Receivable, \(1,500; Office Supplies, \)700; Prepaid Rent, \(2,240; Equipment, \)8,000; Accumulated Depreciation—Equipment, \(0; Salaries Payable, \)0; Unearned Revenue, \(900; Service Revenue, \)4,100; Salaries Expense, \(800; Supplies Expense, \)0; Rent Expense, \(0; Depreciation Expense—Equipment, \)0. The data developed for the March 31 adjusting entries are as follows: a. Service revenue accrued, \(700. b. Unearned revenue that has been earned, \)100. c. Office Supplies on hand, \(300. d. Salaries owed to employees, \)200. e. One month of prepaid rent has expired, \(560. f. Depreciation on equipment, \)120. Requirements 1. Open a T-account for each account using the unadjusted balances given. 2. Journalize the adjusting entries using the letter and March 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.

Identify the impact on the income statement and balance sheet if adjusting entries for the following situations were not recorded. a. Office Supplies used, \(800. b. Accrued service revenue, \)4,000. c. Depreciation on building, \(3,500. d. Prepaid Insurance expired, \)650. e. Accrued salaries expense, \(2,750. f. Service revenue that was collected in advance has now been earned, \)130
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