Following are the December transactions of Cerullo Electrical Contractors. Dec.
ID: 2349615 • Letter: F
Question
Following are the December transactions of Cerullo Electrical Contractors.Dec. 1 Purchased supplies for $300
Dec. 3 Paid $250 electricity bill for November that had been properly recorded
with an adjusting entry on November 30.
Dec.9 Paid employee salaries for the first week of December, 1,200. No salaries
had been previously accrued.
Dec. 16 Received $600 for interest that had been earned in November on a bank
account. An appropriate adjusting journal entry had been recorded for this item on
November 30.
Dec. 22 Received $1,700 from customer in payment of account receivable.
Dec. 26 Paid January rent on leased office space, $400.
Dec. 30 Received $2,500 advance payment from a customer for work to be
performed in January.
Dec. 31 Purchased equipment on credit for $3,000.
a.) Prepare general journal entries for these transactions.
b.) Identify which accounts affected by the journal entries prepared in part (a) are deferred expenses, deferred revenues, accrued assets, or accrued liabilities.
Explanation / Answer
Dec. 1 Purchased supplies for $300 Supplies (Dr.) 300 Cash (Cr.) 300 Deferred expense Dec. 3 Paid $250 electricity bill for November that had been properly recorded with an adjusting entry on November 30 [assuming this adjusting entry included a credit to utilities payable]. Utilities payable (Dr.) 250 Cash (Cr.) 250 Dec.9 Paid employee salaries for the first week of December, 1,200. No salaries had been previously accrued. Salary expense (Dr.) 1200 Salaries payable (Cr.) 1200 Accrued liability Dec. 16 Received $600 for interest that had been earned in November on a bank account. An appropriate adjusting journal entry had been recorded for this item on November 30. Cash (Dr.) 600 Interest receivable (Cr.) 600 Dec. 22 Received $1,700 from customer in payment of account receivable. Cash (Dr.) 1700 Accounts Recievable (Cr.) 1700 Accrued asset Dec. 26 Paid January rent on leased office space, $400. Rent expense (Dr.) 400 Cash (Cr.) 400 Dec. 30 Received $2,500 advance payment from a customer for work to be performed in January. Cash (Dr.) 2500 Unearned fees (Cr.) 2500 Deferred revenue Dec. 31 Purchased equipment on credit for $3,000. Equipment (Dr.) 3000 Accounts Payable (Cr.) 3000 Accrued liability