Chapter Assignments LO3,4 Determining Adjusting Entries, Posting to T Accounts,

Question

Chapter Assignments LO3,4 Determining Adjusting Entries, Posting to T Accounts, and Preparing an Adjusted Trial Balance P3. Kinokaw a Consultants Company's trial balance on December 31, 2014,follow. ? Adjted trial an 106,167 Kinokawa Consultants Company Trial Balance December 31, 2014 Cash 12,786 Accounts Receivable Office Supplies Prepaid Rent Office Equipment 991 1,400 6,700 1,600 1,820 10,000 2,860 Accounts Payable Notes Payable Unearned Service Revenue ?.wah, Capital K. Wah, Withdrawals Service Revenue Salaries Expense Utilities Expense 15.000 29387 15,000 33,00058,500 1,750 7,700 04,167 Rent Expense 104167 The following information is also available: a. Ending inventory of office supplics, $86 b. Prepaid rent expired, $700 c. Depreciation of office equipment for the period, $600 d. Interest accrued on the note payable, $600 e. Salaries accrued at the end of the period, $200 t. Service revenue still unearned at the end of the period, $1,410 g Service revenue carned but not billed, $600 REQUIRED 1. Open T accounts for the accounts in the trial balance plus the following: Interest Payable; Salaries Payable; Office Supplies Expense, Depreciation Expense-Office Equipment; and Interest Expense. Enter the account balances. 2. Determine the adjusting entries and post them directly to the T accounts. 3. Prepare an adjusted trial balance 4 ACCOUNTING CONNECTION which financial statements do each of the above adjustments affect? What financial statement is not affected by the adjustments

Explanation / Answer

1. T-accounts Cash 31/12/2014 $12,786 Accounts receivable 31/12/2014 $24,840 31/12/2014 $600 Office Supplies 31/12/2014 $991 31/12/2014 905 Prepaid Rent 31/12/2014 $1,400 31/12/2014 700 Office Equipment 31/12/2014 $6,700 Accumulated Depreciation-Office Equipment 31/12/2014 $1,600 31/12/2014 $600 Accounts Payable 31/12/2014 $1,820 Notes payable 31/12/2014 $10,000 Unearned Service Revenue 31/12/2014 $1,450 31/12/2014 $2,860 K.Wah, Capital 31/12/2014 $29,387 K.Wah, Withdrawals 31/12/2014 $15,000 Service Revenue 31/12/2014 $58,500 31/12/2014 $1,450 31/12/2014 $600 Salaries Expenses 31/12/2014 $33,000 31/12/2014 $200 Utilities Expenses 31/12/2014 $1,750 Rent Expenses 31/12/2014 $7,700 31/12/2014 $700 Interest payable 31/12/2014 $600 Salaries payable 31/12/2014 $200 Office Supplies Expenses 31/12/2014 $905 Depreciation Expense - Office Equipment 31/12/2014 $600 Interest Expense 31/12/2014 $600 3. Adjusted Trial Balance Particulars Debit Credit Cash $12,786 Accounts Receivable $25,440 Office Supplies $86 Prepaid Rent $700 Office Equipment $6,700 Accumulated Depreciation-Office Equipment $2,200 Accounts Payable $1,820 Notes payable $10,000 Interest Payable $600 Salaries Payable $200 Unearned Service Revenue $1,410 K.Wah, Capital $29,387 K.Wah, Withdrawals $15,000 Service Revenue $60,550 Salaries Expenses $33,200 Utilities Expenses $1,750 Rent Expenses $8,400 Interest Expenses $600 Depreciation Expenses-Office Equipment $600 Office Supplies Expenses $905 $106,167 $106,167 4. Financial Statement Adjustment affects Under the double entry system, all the above adjustments affects the income statement on one hand and balance sheet on other hand Cash Flow Statement is not affected by the adjustment.

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