Prepare journal entries for any required accounting adjustments. Your analysis r
ID: 2416001 • Letter: P
Question
Prepare journal entries for any required accounting adjustments.
Your analysis reveals additional information as follows:
-The cost of inventory items on hand is $46,400.
-Employee wages for the two weeks prior to year end were $15,600 and these will not be paid until the 2015 fiscal year (no other wages are owed).
-The unexpired portion of the company’s insurance policy at year end was $9,200.
-The company’s tax accountant reports that the company will owe $108,000 for income taxes for fiscal 2014.
The unadjusted trial balance of Chicken Express for fiscal 2014, includes the following items:
Debt
$95,600
$1,600
Prepaid Insurance
Taxes Payable
7,600
0
InventoryDebt
$95,600
Credit Wages Payable$1,600
Prepaid Insurance
Taxes Payable
7,600
0
Explanation / Answer
Particulars Dr Amt Cr Amt Costof Goods Sold Dr 49,200.00 To Inventory A/C 49,200.00 (95600 - 46400) Wages Expense Dr 14,000.00 To Wages Payable 14,000.00 (15,600-1600) Prepaid Insurance 1,600.00 To Insurance 1,600.00 (9200-7600) Income Tax Expense 108,000.00 To Income Taxes Payable 108,000.00