Question

Adjusting Entry Events: 1. Jim recalls finishing up a job search for Mack Brown. He forgot to bill Mack the $980. 2. Hoops had worked 8 ($10/hr.) hours as of the end of June. He will not be paid until July 5. 3. An inspection of the insurance policy purchased from No State Insurance on June 12 indicates that it is a 12 month policy that included coverage for the entire month of June. Recall it was $2,400 for 12 months coverage. 4. Jim brought in the water bill for June, dated July 10 for $64. The bill is due upon receipt. 5. Jim counted the supplies remaining in the supply cabinet. The supply cabinet physical count reveals that there is only $80 of supplies remaining. 6. The last payment on the note was on June 21. As of June 30, 9 days of interest at 10%, has accrued but not yet been paid. (Round the result to the nearest dollar.) 7. The car is considered to have a useful life of 48 months with $3,920 salvage value. The computer and equipment is considered to have a 3 year life (36 months) with no salvage value. Round your calculation results to the nearest whole dollar. Assume Wooly had the asset for the entire month.

this is the unadjusted trial balance

Answer 1

Here are the adjusting journal entries:

Adjusting Journal Entry	Dr.	Cr.
Dr. Consulting Fees	980
Cr. A/R		980
(Being bill raised for service done to Mack)
Dr. Salary Expense	80
Cr. Expense Payable		80
(Being Salary payable to Hoops for June)
Dr. Insurance Expense	200
Cr. Prepaid Insurance		200
(Being Insurance exp for June accounted)
Dr. Water Expense	64
Cr. A/P		64
(Being Water bill for Jun payable in July)
Dr. Supply Expense	160
Cr. Supplies		160
(Being Supplies adjusted as per physical count)
Dr. Interest expense	463
Cr. N/P		463
(Being interest payable on N/P accounted)
Dr. Depreciation Expense	335
Cr. Accumulated Depreciation-Car		335
(Being Depreciation for Car accounted under SLM)
Dr. Depreciation Expense	142
Cr. Accumulated Depreciation-Computer		142
(Being Depreciation for Computer & Equipment accounted under SLM)

Post above entries, Trial balance as below:

Trial balance of Wooly Consulting
June 30, 20xx
	Before Adjust Entry		Adjusting Entry		Post Adjusting Entry
Account	Dr.	Cr.	Dr.	Cr.	Dr.	Cr.
Cash	1,979				1,979
A/R	5,300		980		6,280
Supplies	240			160	80
Prepaid Insurance	2,400			200	2,200
Computer/Equipment	5,100				5,100
Car	20,000				20,000
A/P		880		64		944
N/P		15,448		463		15,911
Credit Card Payable
Unearned Fees
Consulting Fees		9,800		980		10,780
Salary Expense	1,200		80		1,280
Utility Expense	500				500
Supply Expense	100		160		260
Interest Expense	89		463		552
Gas Expense	55				55
Advertising Expense	620				620
Travel Expense	445				445
Capital		12,200				12,200
Withdrawals	300				300
Expense Payable				80		80
Insurance Expense			200		200
Water Expense			64		64
Depreciation Expense			477		477
Accumulated Depreciation-Car				335		335
Accumulated Depreciation - Computer / Equipment				142		142
	38,328	38,328	2,424	2,424	40,392	40,392