Question

1. (Adjusting Entries )

ABC Companies accounting period ends in December 31, 2017. At December 31 2016, the following information was available for adjusting entries

1. The company gave a note payable on December 31 to a supplier. Interest of $300 has accrued

2. A count on December 31 indicates that supplies on hand total $3000. Supplies of $10000 were purchases and debited to the supplies account during the year. Supplies on hand at January 2017 totaled

3. An analyst of the company’s insurance policy reveals that a one year premium of $2000 was paid on October 1, 2017. The entire premium amount was debited to prepaid insurance

4. One year rent on some vacant building space of $5000 was collected on October 1, 2020. The entire amount was credited to Rent Revenue

Answer 1

Adjusting entries

No	General Journal	Debit	Credit
1	Interest expense	300
	Interest payable		300
2	Supplies expense (10000-3000)	7000
	Supplies		7000
3	Insurance expense (1000/12*3)	250
	Prepaid insurance		250
4	Rent revenue (5000/12*9)	3750
	Deferred rent revenue		3750