Can someone answer the requirments 1-4 after adjustments were made? Thank you. A
ID: 2458775 • Letter: C
Question
Can someone answer the requirments 1-4 after adjustments were made? Thank you.
Adjustment data at December 31 follow: On December 15, Arlington contracted to perform services for a client receiving $2,600 in advance. Arlington recorded this receipt of cash as Unearned Revenue. As of December 31, Arlington has completed $1,100 of the services. Arlington prepaid two months of rent on December 1. Arlington used $600 of office supplies. Depreciation for the equipment is $900. Arlington received a bill for December's online advertising, $900. Arlington will not pay the bill until January. (Use Accounts Payable.) Arlington pays its employees on Monday for the previous weekly wages. Its employees earn $1,500 for a five-day workweek. December 31 falls on Wednesday this year. On October 1, Arlington agreed to provide a four-month air system check (beginning October 1) for a customer for $3,200. Arlington has completed the system check every month, but payment has not yet been received and no entries have been made. Journalize the adjusting entries on December 31. Using the unadjusted trial balance, open the T-accounts with the unadjusted balances. Post the adjusting entries to the T-accounts. Prepare the adjusted trial balance. How will Arlington Air Purification System use the adjusted trial balance?Explanation / Answer
1)
Journal entries as on December 31
3)
Adjusted Trial balance as on December 31
4)
The adjusted trial balance will be used to prepare the Profit and Loss account and the balance sheet of the entity.
a) Date Particulars LF Amount $ Amount $ December 31 Unearned Revenue 1,100 To Service Revenue 1,100 (Being amount of service provided till December 31 booked as revenue) b) December 31 Rent Expense 1,200 To Prepaid Rent 1,200 (Being rent paid for December and January earlier shown as prepaid rent, now rectified for December) c) December 31 Supplies Expense 600 To Office supplies 600 (Being office supplies used charged to profits and Loss account) d) December 31 Depreciation expense-equipment 900 To Accumulated Depreciation-Equipment 900 (Being depreciation expense accounted for equipment) e) December 31 Advertising Expense 900 To Accounts Payable 900 (Being advertising expenses booked for the month of December) f) December 31 Salaries expense 900 To Salaries payable 900 (Being salary for Monday to Wednesday that is 3 days in a five day workweek accounted for the week ending december 31) g) December 31 Accounts Receivable 2,400 To Service Revenue 2,400 (Being services rendered from October to December accounted for as revenue)