Question

Till adjusting entries. (LO 2, 3) AP P3-6B The following independent items for Théâtre Dupuis during the year ended November 30, 2017, lay require a transaction journal entry, an adjusting entry, or both. The company records all prepaid costs as assets and all uncarned revenues as liabilities and it adjusts accounts annually. 1. Supplies on hand amounted to $950 on November 30, 2017. On January 31, 2017. additional supplies were purchased for $2,880 cash. On November 30, 2017, a physical count showed that supplies on hand amounted to $670. 2. Théâtre Dupuis puts on 10 plays each season. Season tickets sell for $200 each and 310 were sold in August for the upcoming 2017-2018 season, which starts in September 2017 and ends in June 2018 (one play per month). Théâtre Dupuis credited Unearned Revenue for the full amount received. 3. The total payroll for the theatre is $4,500 every Wednesday for employee salaries earned during the previous five-day week (Wednesday through Sunday). Salaries were last paid (and recorded) on Wednesday, November 29. In 2017. November 30 falls on a Thursday. The next payday is Wednesday, December 6, 2017 4. Theltre Dupuis rents the theatre to a local seniors' choir, which uses the space for rehearsals twice a week at a rate of $425 per month. The new treasurer of the choir accidentally sent a cheque for $245 on November 1. The treasurer promised to send a cheque in December for the balance when she returns from her vacation. On December 4, Theltre Dupuis received a cheque for the balance owing from November plus all of December's rent. 5. On June 1, 2017, the theatre borrowed $11,000 from La caisse populaire Desjardins at an annual interest rate of 4.5%. The principal and interest are to be repaid on February 1, 2018 6. Upon reviewing the books on November 30, 2017, it was noted that the utility bill for the month of November had not yet been received. A call to Hydro-Quebec determined that the utility bill was for $1.420. The bill was paid on December 10. 7. Owned a truck during the year that had originally been purchased on December 1, 2013. for $37.975. The truck's estimated useful life is eight years. Instructions (a) Prepare the journal entries to record the original transactions for items 1 through 5. (b) Prepare the year-end adjusting entries for items I through 7. (c) Prepare the journal entries to record: 1. the payment of wages on Wednesday, December 6 (item 3). 2. the receipt of the cheque from the seniors choir on December 4 (item 4). 3. the payment of the utility bill on December 10 (item 6). 4. the payment of the note and interest on February 1, 2015 (item 5). AKING IT FURTHER There are the la

Answer 1

The accounting entries for each question is as follows, please note the dates are in DD-MM-YYYY format.

	Accounting entries in the books of Theatre Dupuis
a)	Date	Account Title and Explanation	Debit	Credit
	31/01/2017	Supplies	2,880
		Cash		2,880
		(To record purchase of supplies)
	31/08/2017	Cash	62,000
		Unearned Revenue		62,000
		(To record sale of tickets)
	29/11/2017	Salaries	4,500
		Cash		4,500
		(To record salaries paid)
	01/11/2017	Bank	245
		Rental income		245
		(To record receipt of rental income)
	01/06/2017	Cash	11,000
		External loan		11,000
		(To record loan borrowed)

b)	Date	Account Title and Explanation	Debit	Credit
	30/11/2017	Supplies loss	280
		Supplies		280
		(To record the difference between physical count and the book balance, calculated as 970-670)
	30/11/2017	Unearned revenue	18,600
		Revenue		18,600
		(To record the revenue accrued for the 3 months, calculated as 310/10*3*200)
	30/11/2017	Salary	900
		Unpaid Salary		900
		(To record unpaid salary earned by employees on Nov 30, calculated as 4,500/5 )
	30/11/2017	Accrued rental income	180
		Rental income		180
		(To record balance of the rental income to be received, calculated as 425-245)
	30/11/2017	Interest expense	247.50
		Interest payable		247.50
		(To record interest payable on loan borrowed, interest calculated as 11,000*4.5%*6/12)
	30/11/2017	Untility	1,420
		Untility payable		1,420
		(To record utility bill for the month Nov 2017)
	30/11/2017	Depreciation	4,747
		Accumulated depreciation		4,747
		(To record depreciation for the year ended Nov 30, 2017, calculated as 37,975/8)

c)	Date	Account Title and Explanation	Debit	Credit
	06/12/2017	Unpaid salary	900
		Salary	3,600
		Cash		4,500
		(To record salary paid)
	06/12/2017	Bank	605
		Accrued rental income		180
		Rental income		425
		(To record cheque received for rental income)
	10/12/2017	Untility payable	1,420
		Cash		1,420
		(To record payment of utility bill)
	01/02/2015	External loan	11,000
		Interest payable	247.50
		Interest	82.50
		Cash		11,330
		(To record repayment of loan including interest)