Depreciation on the company's equipment for 2017 is computed to be $18,000. the prepaid insurance account had a $6,000 debit balance at december 31, 2017, before adjusting for the costs of any expired coverage. an analysis of the company's insurance policies showed that $1,100 of unexpired insurance coverage remains. the office supplies account had a $700 debit balance on december 31, 2016; and $3,480 of office supplies were purchased during the year. the december 31, 2017, physical count showed $300 of supplies available. two-thirds of the work related to $15,000 of cash received in advance was performed this period. the prepaid insurance account had a $6,800 debit balance at december 31, 2017, before adjusting for the costs of any expired coverage. an analysis of insurance policies showed that $5,800 of coverage had expired. wage expenses of $3,200 have been incurred but are not paid as of december 31, 2017.

Question

Lozano

Business

13 January, 20:42

Depreciation on the company's equipment for 2017 is computed to be $18,000. the prepaid insurance account had a $6,000 debit balance at december 31, 2017, before adjusting for the costs of any expired coverage. an analysis of the company's insurance policies showed that $1,100 of unexpired insurance coverage remains. the office supplies account had a $700 debit balance on december 31, 2016; and $3,480 of office supplies were purchased during the year. the december 31, 2017, physical count showed $300 of supplies available. two-thirds of the work related to $15,000 of cash received in advance was performed this period. the prepaid insurance account had a $6,800 debit balance at december 31, 2017, before adjusting for the costs of any expired coverage. an analysis of insurance policies showed that $5,800 of coverage had expired. wage expenses of $3,200 have been incurred but are not paid as of december 31, 2017.

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Answers (1)

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Caitlin Solomon · Answer 1

a.

Dr Depreciation expense-Equipment18,000

Cr Accumulated depreciation-Equipment18,000

b.

Dr Insurance expense4,900

Cr Prepaid insurance4,900

c.

Dr Office supplies expense3,880

Cr Office supplies3,880

d.

Dr Unearned fee revenue10,000

Cr Fee revenue10,000

e.

Dr Insurance expense5,800

Cr Prepaid insurance5,800

f.

Dr Wages expense3,200

Cr Wages payable3,200

Explanation:

Journal entries

a.

Dr Depreciation expense-Equipment18,000

Cr Accumulated depreciation-Equipment18,000

b.

Dr Insurance expense4,900

(6,000-1,100)

Cr Prepaid insurance4,900

c.

Dr Office supplies expense3,880

Cr Office supplies3,880

(700+3,480-300)

d.

Dr Unearned fee revenue10,000

Cr Fee revenue10,000

(15,000*2/3)

e.

Dr Insurance expense5,800

Cr Prepaid insurance5,800

f.

Dr Wages expense3,200

Cr Wages payable3,200