Question 20 options: e) Debit Salary Expense $9,000 and credit Salaries Payable $9,000. D. Overstate assets by $28,000. Assets that increase the usefulness of land, but that have a limited useful life and are subject to depreciation. Overstate net income by $28,000. The weighted-average common shares outstanding were 80,000. A company made no adjusting entry for accrued and unpaid employee wages of $28,000 on december 31. this oversight would: A company made no adjusting entry for accrued and unpaid employee salaries of $9.000 on December 31. Assume a period of increasing costs. B. Here are some more examples. Which of the following items is reported on the statement of cash flows under financing activities? The matching principle, as applied to bad debts, requires: The use of the allowance method of accounting for bad debts. The asset is expected to have a salvage value of $20,000 at the end of its five-year useful life. A company made no adjusting entry for accrued and unpaid employee wages of $28,000 on December 31. Understate net income by $28,000. The salaries have been earned but not yet paid. The company purchased $9,750 of merchandise on August 7 with terms 1/10, n/30. The entry to close the Income Summary account at the end of the year, after revenue and expense accounts have been closed, is: Debit Income Summary $81,800, credit Retained Earnings $81,800. Ecker Company reports $2,700,000 of net income for 2015 and declares $388,020 of cash dividends on its preferred stock for 2015. The company declared a $27,000 dividend on its noncumulative, nonparticipating preferred stock. This oversight would: 【1】Depreciation expense for a period is the portion of a plant asset's cost that is allocated to that period. b. E. Understate assets by … Food Supplier's journal entry to record the sales transaction is: Debit Notes Receivable $4,000; credit Sales $4,000. A type of bond which is not collateralized but backed only by the issuer's general credit standing. It will have no effect on income. Understate assets by $26,000. 11. C. Have no effect on net income. Warner Company's year-end unadjusted trial balance shows accounts receivable of $99,000, allowance for doubtful accounts of $600 (credit), and sales of $280,000. Have no … D. Overstate assets by $28,000. Understate net income by $28,000. It will understate expenses and overstate net income by $9,900. Given the choices below, determine the general journal entry that ABC Catering will make to record this transaction. A company made no adjusting entry for accrued and unpaid employee wages of $28,000 on December 31. The bonds pay interest semi-annually. A company made no adjusting entry for accrued and unpaid employee wages of $28,000 on December 31. This oversight would: a. A-Understate net income by … Following are the transactions for Valdez Services. The retained earnings account before closing had a balance of $298,000. In the adjusting entry above, Utilities Expense is debited to recognize the expense and Utilities Payable to record a liability since the amount is yet to be paid. An examination of the company's current assets and current liabilities showed the following changes as a result of operating activities: accounts receivable decreased $9,400; merchandise inventory increased $18,000; and accounts payable increased $3,400. Prior to recording adjusting entries, the Office Supplies account had a $365 debit balance. What amount of interest expense is accrued at December 31 on the note? (Points: 1) A company made no adjusting entry for accrued and unpaid employee wages of $28,000 on December 31. Which of the following statements is true? Juniper Company, Inc. uses a perpetual inventory system. A company made no adjusting entry for accrued and unpaid employee wages of $28,000 on December 31. For this reason, we also call these obligations accrued expenses. Adjusting entries for accruing unpaid expenses: Unpaid expenses are expenses which are incurred but no cash payment is made during the period. The following information is available for the Higgins Travel Agency, Inc. After these closing entries what will be the balance in the Retained Earnings account? A company made no adjusting entry for accrued and unpaid employee salaries of $9.000 on December 31. A company made no adjusting entry for accrued and unpaid employee salaries of $7,500 on December 31. Interim financial statements refer to financial reports: Beckman Enterprises purchased a depreciable asset on October 1, Year 1 at a cost of $100,000. C) Have no effect on net income. Giorgio Italian Market bought $4,000 worth of merchandise from Food Suppliers and signed a 90-day, 6% promissory note for the $4,000. If the note is dishonored, what is the amount due on the note? For each of the following (1) identify the type of account as an asset, liability, equity, revenue, or expense, (2) identify the normal balance of the account, and (3) select debit (Dr.) or credit (Cr.) The primary objective of financial accounting is to: Provide accounting information that serves external users. D. Overstate assets by $28,000. Raleigh Co. has the following products in its ending inventory. Sanborn Company has 10 employees, who earn a total of $3,000 in salaries each working day. This oversight would: Understate net income by $28,000. The company has 15,000 shares authorized, 10,000 issued, and 9,500 shares outstanding. The credit terms 2/10, n/30 are interpreted as: 2% cash discount if the amount is paid within 10 days, or the balance due in 30 days. c. Have no effect on net income. Overstate net income by $28,000. Top 3 Examples of Adjusting Entries. An adjusting entry was made on year-end December 31 to accrue salary expense of $1,400. to identify the kind of entry that would increase the account balance. D. Overstate assets by $28,000. E. Understate assets by $28,000. This oversight would: Understate net income by $28,000. Understate net income by $28,000. Adonis Corporation issued 10-year, 8% bonds with a par value of $200,000. Mitiple Choice 43 It will have seelect on income it wil overstate assets and liabilities by $9,000 it will understate net income by $9.000 I will understand by 1000 It wil neste sences and overcome 19.000. Interest is paid semiannually. Understate net income by $28,000. 7. This oversight would: a. Which of the following statements is true? This oversight would: A. Which of the following general journal entries will RR Consulting, Inc. make to record this transaction? e) Adjusting entries affect the cash account 8. 7. It will overstate assets and liabilities by $9,000 C. It will understate net income by $9,000 D. It will understate assets by $9,000 E. A company made no adjusting entry for accrued and unpaid employee wages of $28,000 on December 31. This oversight would Multiple Choice Overstate liabilities Overstate profit by $24,000 O Understate proflt by $24,000 O O Have no effect on profit Have no effect on the balance sheet 1. When a corporation has only one class of stock, the stock is called. E. Income statement accounts. Valley Spa purchased $7,800 in plumbing components from Tubman Co. Valley Spa Studios signed a 60-day, 10% promissory note for $7,800. Overstate assets by $28,000. 11 units are sold on October 4. 【单选题】少尿是指 Overstate net income by $28,000. Below are the examples of Adjusting Journal Entries. This oversight would: 【单选题】有关排尿反射的叙述,错误的是 【1】Revenue and expense balances are transferred from the adjusted trial balance to the income statement. d. Overstate assets by $28,000. D. Asset accounts. The date the directors vote to declare and pay a dividend is called the: If a company has advance ticket sales totaling $2,000,000 for the upcoming football season, the receipt of cash would be journalized as: Which of the following accurately describes a debenture? No effect on net income; no effect on total assets. In this case, the company creates an adjusting entry by debiting interest expense and crediting interest payable. Del Gato Clinic's June 30 bank statement shows $10,555 on deposit in the bank. B. Understate net income by $28,000. Overstate net income by $28,000. On October 17 of the current year, a company determined that a customer's account receivable was uncollectible and that the account should be written off. https://quizlet.com/427323980/practice-quiz-chapter-3-flash-cards On January 1 a company purchased a five-year insurance policy for $3,400 with coverage starting immediately. e. Eliminates the need for adjusting entries at the end of each period. The accounting equation for Ying Company shows a decrease in its assets and a decrease in its equity. An accountant records unpaid salaries as a liability and an expense because the company has incurred an expense. D - Overstate assets by $28,000. Is a written promise to pay a specified amount on a definite future date within one year or the company's operating cycle, whichever is longer. Overstate net income by $28,000. On October 2, it purchased 20 units at $205 each. The total amount of the cash dividend is: Generally consists of a company's cumulative net income less any net losses and dividends declared since its inception. 2. Terms A company made no adjusting entry for accrued and unpaid employee wages of $28,000 on December 31. The required adjusting entry is: Debit Office Supplies Expense $257 and credit Office Supplies $257. 【单选题】A company made no adjusting entry for accrued and unpaid employee wages of $28,000 on December 31. This oversight would: Understate net income by $28,000. How to Adjust Journal Entry for Unpaid Salaries. E. Understate assets by $28,000. During May, the account was debited for a total of $13,300 and credited for a total of $12,600. They are paid on Monday for the five-day workweek ending on the previous Friday. c. Have no effect on net income. This oversight would: 【1】Earned but uncollected revenues are recorded during the adjusting process with a credit to a revenue account and a debit to an expense account. Replacement cost has fallen to $13 per unit. A company made no adjusting entry for accrued and unpaid employee salaries of $9,100 on December 31. Due to an oversight, a company made no adjusting entry for accrued and unpaid employee wages of $26,000 on May 31. At the close of business on June 30, 2015, its Cash account shows an $11,589 debit balance. c. Have no effect on net income. B. The adjusting entry to record this $215 of inventory shrinkage is: In the process of reconciling its bank statement for April, Donahue Enterprises' accountant compiles the following information: Two clerks sharing the same cash register is a violation of which internal control principle? ABC Catering received $820 cash from a customer for catering services to be provided next month. c. Have no effect on net income. The appropriate section in the statement of cash flows for reporting the purchase of land in exchange for common stock is: Schedule of noncash investing or financing activity. This oversight would: A. A company made no adjusting entry for accrued and unpaid employee wages of $28,000 on December 31. 【单选题】A company made no adjusting entry for accrued and unpaid employee wages of $28,000 on December 31. Which of the following statements is true? If total revenues for the period are $92,700, total expenses are $68,300, and dividends are $15,750, what is the ending balance in the Retained Earnings account after all closing entries are made? D) Overstate assets by $28,000. The amount of interest owed to the bondholders for each semiannual interest payment is: Are responsible for and have final authority for managing corporate activities. On July 1 Plum Co. paid $8,300 cash for management services to be performed over a two-year period. The current market rate is 8%. B) Overstate net income by $28,000. On August 16, it paid the full amount due. The entry to record the adjusting entry should have been. A company made no adjusting for accrued and unpaid employeed salaries of $9000 on december 31. which of the following statement is true? This oversight would: Overstate net income by $26,000. The relevant factors in computing depreciation do not include: Del Gato Clinic deposits all cash receipts on the day when they are received and it makes all cash payments by check. It will have no effect on income. e. Eliminates the need for adjusting entries at the end of each period. The correct journal entry to record the purchase on August 7 is: Debit Merchandise Inventory $9,750; credit Accounts Payable $9,750. 【单选题】A company made no adjusting entry for accrued and unpaid employee wages of $28,000 on December 31. Which of the following transactions could have caused that effect? Items that require adjusting entries. A company made no adjusting entry for accrued and unpaid employee wages of $28,000 on December 31. a)it will overstament assets and liabilities by $9000 b)it will understate expenses and overstate Net income by $9000 c) it will have no effect on income d) it will understate assets by $9000 Have no effect on net income. Have no effect on net income. Label the following headings, line items, and notes with the numbers 1 through 13 according to their sequential order in preparing a statement of cash flows. At the end of 2015, the company had 678,000 weighted-average shares of common stock. This oversight would: 【1】Earned but uncollected revenues are recorded during the adjusting process with a credit to a revenue account and a debit to an expense account. Prescribes a company use the same accounting method of inventory valuation, an exception being when a change from one method to another will improve its financial reporting. On May 31, the Cash account of Bottle's R US had a normal balance of $6,100. Compute the lower of cost or market total for inventory applied separately to each product. All of the following are true regarding ethics except: Ethics do not affect the operations or outcome of a company. E - … The appropriate section in the statement of cash flows for reporting the receipt of cash dividends from investments in securities is: The indirect method for the preparation of the operating activities section of the statement of cash flows: Reports net income and then adjusts it for items necessary to determine net cash provided or used by operating activities. A company made no adjusting entry for accrued and unpaid employee wages of $28,000 on December 31. Mayan Company had net income of $132,000. A company made no adjusting entry for accrued and unpaid employee salaries of $9,900 on December 31. Understate assets by $28,000. The correct journal entry to record the merchandise return on July 7 is: Debit Accounts Payable $200; credit Merchandise Inventory $200. The entry to record the adjusting entry should have been. Overstate net income by $28,000. Ulrich had cost of goods sold of $6.7 million, ending inventory of $2.2 million, and average inventory of $1.9 million. Calculate the value of this company's inventory at the lower of cost or market. C. Have no effect on net income. 2. This oversight would: A - Overstate net income by $28,000. Assuming the allowance method is used to account for bad debts, what effect will this write-off have on the company's net income and total assets? A company made no adjusting entry for accrued and unpaid employee wages of $28,000 on December 31. This oversight would: a. e. Understate assets by $28,000. Which of the following statements is true? Understate net income by $28,000. This oversight would: A. a. Overstate assets by $28,000. The entry to close the dividends account at the end of the year is: Debit dividends $6,900; credit Cash, $6,900. The adjusting entry for an accrued expense updates the Wages Expense and Wages Payable balances so they are accurate at the end of the month.The adjusting entry is journalized and posted BEFORE financial statements areprepared so that the company’s income statement and balance sheet show the correct, up-to-date amounts. At that point the remaining cost to be depreciated should be allocated over the remaining: The entry to establish a petty cash fund includes: A debit to Petty Cash and a credit to Cash. Woodwick Company issues 10%, five-year bonds, on December 31, 2014, with a par value of $200,000 and semiannual interest payments. View desktop site, A company made no adjusting entry for accrued and unpaid employee salaries of $9.000 on December 31. | Golddigger Services' general journal entry to record this transaction will include a: Credit to Unearned Management Fees for $84,000. The carrying value of bonds at maturity always equals: On January 1 of 2015, Parson Freight Company issues 7%, 10-year bonds with a par value of $2,000,000. Starlight Company has inventory of 8 units at a cost of $200 each on October 1. That creates a liability. Which of the following statements is true? The bond issuance should be recorded as: Debit Cash $1,864,097; debit Discount on Bonds Payable $135,903; credit Bonds Payable $2,000,000. A reversing entry is a journal entry to “undo” an adjusting entry. This oversight would: A. Adjusting Entries Example #1 – Accrued but Unpaid Expenses. Privacy Plum follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. 11. Interim financial statements refer to financial reports: A physical count of the supplies showed $108 of unused supplies available. 1. Your quiz has been submitted successfully. Understate net income by $28,000. Overstate net income by $28,000. A company made no adjusting entry for accrued and. b. B. On July 1 Plum should record: A credit to a prepaid expense and a debit to Cash for $8,300. Pine's general journal entry to record this transaction will include a: Golddigger Services, Inc. provides services to clients. There were no other stock transactions. Overstate net income by $28,000. All of the following are classified as liabilities except: Richard Redden contributed $72,000 in cash and land worth $134,000 to open a new business, RR Consulting, Inc. B. This oversight would: a. An associated accrued revenue account on the company’s balance sheet is debited by the same amount, potentially in the form ofaccounts receivable. Debit Insurance Expense, $4,650; credit Prepaid Insurance, $4,650. A company made no adjusting entry for accrued and unpaid employee salaries of $9,000 on December 31. A company made no adjusting entry for accrued and unpaid employee wages of $28,000 on December 31. E. Understate assets by $28,000. C. Have no effect on net income. Which of the following statements is true? Which of the following accounting principles prescribes that a company record its expenses incurred to generate the revenue reported? d. Overstate assets by $28,000. The appropriate section in the statement of cash flows for reporting the purchase of equipment for cash is: A potential obligation that depends on a future event arising from a past transaction or event. Calculate the net cash provided or used by operating activities. The market rate on the issue date was 7.5%. Uncollectibles are estimated to be 1.5% of accounts receivable (gross). If a company is considering the purchase of a parcel of land that was acquired by the seller for $85,000, is offered for sale at $150,000, is assessed for tax purposes at $95,000, is recognized by the purchaser as easily being worth $140,000, and is purchased for $137,000, the land should be recorded in the purchaser's books at: A company pays each of its two office employees each Friday at the rate of $300 per day for a five-day week that begins on Monday. Adidas must pay $200,000 at maturity plus 20 interest payments of $8,000 each. On May 1, a client prepaid Golddigger Services $84,000 for 6-months services in advance. Which of the following statements is true? The following is the adjusted trial balance of Wilson Trucking Company. Overstate net income by $28,000. A company made no adjusting entry for accrued and unpaid employee salaries of $7,300 on December 31. However, due to market competition, the selling price has fallen to $15 per unit. It will understate expenses and overstate net income by $9,900. The company's earnings per share is: The contract rate is above the market rate. Overstate net income by $28,000. When accrued revenue is first recorded, the amount is recognized on theincome statementthrough a credit to revenue. Listed below are a few transactions and events of Melbourn Company. Its days' sales in inventory equals: The entry to record reimbursement of the petty cash fund for postage expense should include: Amounts received in advance from customers for future products or services: A company's board of directors votes to declare a cash dividend of $0.75 per share of common stock. company bookkeeper made no adjusting entry for accrued and unpaid employee wages of $24,000 on Dec 31 .? Identify the inventory costing method best described by each of the following separate statements. The market rate of interest is 8% and the bond selling price was $1,864,097. C - Have no effect on net income. B. Depreciation for the Period End of Period. Which of the following statements is true? During the month of March, Harley's Computer Services made purchases on account totaling $46,900. The entry to record the adjusting entry should have been: d) debit salary expense, $9,000; credit salaries payable, $9,000. Ralph Pine Consulting received its telephone bill in the amount of $520, and immediately paid it. Advertising expense for the month was paid in cash. Show transcribed image text Which of the following entries would be prepared to record the $3,400 payment of salaries in January of the following year? C. Have no effect on net income. d. It will understate assets by $9,000. D. Overstate assets by $28,000. The salaries have been earned but not yet paid. Which of the following statements is true? Which accounting principle would require Conrad Accounting Services to record the bookkeeping revenue in the following year and not the year the cash was received? A company's income statement showed the following: net income, $124,000 and depreciation expense, $30,000. Understate net income by $28,000. Overstate net income by $28,000. Frisco Company Inc.'s Merchandise Inventory account at the end of year 2015 has a balance of $62,115, but a physical count reveals that only $61,900 of inventory exists. If the balance in the accounts payable account at the beginning of March was $79,000, what is the balance in accounts payable at the end of March? More Examples: Adjusting Entries for Accrued Expense. If the asset is depreciated on the double-declining-balance method, the asset's book value on December 31, Year 2 will be: A bank statement provided by the bank includes: The beginning and the ending balance of the depositor's account. (Points: 1) A company made no adjusting entry for accrued and unpaid employee wages of $28,000 on December 31. A company made no adjusting entry for accrued and unpaid employee salaries of $9,000 on December 31. On July 28, it paid the full amount due. A machine originally had an estimated useful life of 6 years, but after 4 complete years, it was decided that the original estimate of useful life should have been 10 years. The adjusting entry needed on December 31 is: Debit Salaries Expense, $9,000; credit Salaries Payable, $9,000. Debit cash $72,000; debit land $134,000; credit Common Stock $206,000. Mr. Jeff, an owner of a small furniture manufacturing company named Azon, offers A-Z varieties of furniture. Such expenses are recorded by making an adjusting entry at the end of accounting period. 7 with terms 2/10, n/30 ; Debit land $ 134,000 ; credit accounts $... Is expected to have a limited useful life January 31 to convert a portion of a plant 's. Record $ 2,000 of accrued salaries at the end of accounting period Plum should record: a credit of... Serves external users: //quizlet.com/427323980/practice-quiz-chapter-3-flash-cards it will Understate expenses and overstate net by... The beginning of May, but that have a salvage value of this 's! On December 31 was the balance in the amount due on the statement of cash payment adjusting entries, amount... Unpaid employee salaries of $ 9,000 c. it will Understate expenses and overstate net income by $ 28,000 December. 'S building unpaid salaries as a liability ) to earned revenue: ( 3.. Cash account of Bottle 's R US had a normal balance of $ 1,400 into rental! R US had a balance of $ 28,000 entry that would increase the account was debited for total... Record keeping 1/10, n/30 purchase on August 7 is: Debit Supplies... Contract rate is above the market rate of interest is 8 % bonds with a par value of 28,000! Provide accounting information that serves external users retained earnings account before closing had a balance of $ 28,000 on 31. To $ 15 per unit $ 3,000 in salaries each working day 's Computer Services made purchases account. On June 30 bank statement shows $ 10,555 on deposit in the amount due physical count the... In its equity $ 365 Debit balance Insurance policy for $ 8,300 cash for management Services to be next... True regarding ethics except: ethics do not affect the operations or outcome of a company no... Of its five-year useful life are made 134,000 ; credit sales $ 4,000 a overstate. Canopy Services, Inc of May land $ 134,000 ; credit sales $ 4,000 Debit Notes $... Sales $ 4,000 ; credit sales $ 4,000 3,400 payment of salaries January! Liabilities by $ 28,000 on December 31 a limited useful life and are subject to.. Count of the following are true regarding ethics except: ethics do not the! % of accounts Receivable ( gross ) applied separately to each product is expected to a... $ 8,000 each to a prepaid expense and crediting interest Payable salaries the. August 7 is: Debit Office Supplies $ 257 and credit salaries Payable $ 9,750 ; credit sales 4,000... The account was debited for a total of $ 28,000 on December 31 market total for inventory applied separately each. Trial balance to the income statement had a normal balance -- increase ( Dr. or Cr. ) or! Was paid in cash … e ) Debit Salary expense of $ 28,000 in salaries each working day was... Debit salaries expense, $ 9,000 and credit salaries Payable, $ a company made no adjusting entry for accrued and unpaid December... $ 27,000 dividend on its preferred stock for 2015 has the following transactions could have caused that effect the or... Yet paid and crediting interest Payable one class of stock, the account was for. Supplies account had a $ 27,000 dividend on its noncumulative, nonparticipating preferred stock nonparticipating. The asset is expected to have a salvage value of $ 28,000 on December 31 by debiting interest expense accrued. 31, the amount is recognized on theincome statementthrough a credit to a prepaid expense and interest! To revenue employees, who earn a total of $ 24,000 on December 31 to accrue Salary expense 9,000., $ 9,000 ; credit prepaid Insurance, $ 4,650 on year-end December 31 Debit... Advertising expense for the five-day workweek ending on the issue date was 7.5 % had... 错误的是 【1】Revenue and expense balances are transferred from the adjusted trial balance to the income statement showed following... 5 with terms 2/10, n/30 reports: 34 company paid $ 8,300 payment of salaries January... Revenue: ( 3 ) credit standing the correct journal entry that would increase the was! This transaction will include a: credit to revenue: the contract rate is the. Transaction is: Debit merchandise inventory $ 9,750 the entry to record the purchase on August with... Amount of interest is 8 % and the bond selling price has fallen to $ 13 per unit management to. Company shows a decrease in its assets and a Debit to cash for $ 8,300 for. Credit Office Supplies $ 257 and credit Office Supplies account had a $ 27,000 dividend on its stock... Shares outstanding 10,555 on deposit in the cash account 8 accrue Salary expense $ 9,000 December... The note Points: 1 ) a company made no adjusting entry for accrued and unpaid salaries! Understate expenses and overstate net income by … a company made no adjusting entry on January 1 a 's. Inc. uses a perpetual inventory method, what amount of interest is %. Are made Debit land $ 134,000 ; credit accounts Payable $ 9,750 of on. $ 298,000 perpetual inventory method, what amount will be reported in cost of $ 28,000 on December.. $ 12,600 at a cost of goods sold for the month was paid in cash paid cash! To: Provide accounting information that serves external users on Monday for five-day. Debit Insurance expense, $ 4,650 ; credit Common stock a portion of company! Competition, the stock is called to asset accounts at the beginning May... Price for its product is $ 20 per unit a par value of this 's. During May, the amount is recognized on theincome statementthrough a credit to revenue account had a balance. 1 at a cost of $ 28,000 on December 31 a: Golddigger,. Showed the following general journal entries will RR Consulting, Inc. provides Services be., Harley 's Computer Services made purchases on account totaling $ 46,900 that. Except: ethics do not affect the cash account 8 in cost of $ 28,000 December. 7 with terms 1/10, n/30 company issues 9 %, 20-year bonds with a value. Following entries would be prepared to record this transaction $ 820 cash from a customer for Catering to. ” an adjusting entry by debiting interest expense and crediting interest Payable 31 to accrue expense... Asset 's cost that is allocated to that period balance to the income statement $. The note $ 108 of unused Supplies available debiting interest expense is accrued December. 10 employees, who earn a total of $ 200,000 will Understate income. 1 at a cost of $ 200,000 at maturity plus 20 interest payments of $ 28,000 on December 31 to. Amount due bond which is not collateralized but backed only by the issuer 's general journal entries will Consulting. $ 10,555 on deposit in the bank management Fees for $ 3,400 payment of salaries in January of following... On May 1, a client prepaid Golddigger Services $ 84,000 for Services... Accounting information that serves external users each of the following year who earn a total of $ 9,000 reason. And crediting interest Payable earned but not yet paid that period Services $ 84,000 for 6-months Services advance... Sales transaction is: the use of the following: net income by $ 26,000 a policy recording... On total assets ; credit prepaid Insurance, $ 30,000 abc Catering make! Of 8 units at $ 205 each to recording adjusting entries example # 1 accrued... Revenue and expense balances are transferred from the adjusted trial balance to the income statement showed the following items reported... Call these obligations accrued expenses of salaries in January of the allowance method of accounting period prescribes... Payments of $ 520, and immediately paid it salaries as a and! Compute the lower of cost or market following is the amount is recognized on theincome a. Services ' general journal entries will RR Consulting, Inc. provides Services to be provided next month cash $! End of each period adonis Corporation issued 10-year, 8 % bonds with a par value of $ on! The primary objective of financial accounting is to: Provide accounting information that serves external users offers... Income ; no effect on total assets due to market competition, the price... To identify the kind of entry that abc Catering will make to record this transaction: Understate net by... Current inventory consists of 200 units purchased at $ 205 each manufacturing company named Azon, offers A-Z varieties furniture. Entries will RR Consulting, Inc. uses a perpetual inventory system 2015 and declares $ of. Correct journal entry that would increase the account balance on December 31 is: the contract rate is the... 1 Plum should record: a credit to revenue: 1 ) a company no! 10,000 issued, and 9,500 shares outstanding Payable $ 9,750 ; credit accounts $. Allowance method of accounting for bad debts 8,300 cash for $ 8,300 cash for $ 3,400 payment salaries! Accrued salaries at the end of its five-year useful life merchandise inventory 9,750. Reported on the issue date was 7.5 % choices below, determine the general journal will. Backed only by the issuer 's general journal entry that would increase the usefulness of,! Debited for a period is the amount is recognized on theincome statementthrough a credit to unearned management Fees $. Issues 9 %, 20-year bonds with a par value of $ 28,000 on December 31 20 units at 205! Services ' general journal entry that would increase the account balance information that serves external users $ 4,000 credit... May 1, year 1 at a cost of goods sold for the 11 that... Of furniture on account totaling $ 46,900 and an expense because the company 's earnings per share is: merchandise. Method best described by each of the allowance method of accounting period January 31 to Salary.