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Financial & Managerial Accounting 3rd Edition by Charles Horngren,Harrison, Walter,Suzanne Oliver
Edition 3ISBN: 978-0132962339Financial & Managerial Accounting 3rd Edition by Charles Horngren,Harrison, Walter,Suzanne Oliver
Edition 3ISBN: 978-0132962339 Exercise 26
Journalizing adjusting entries
Lindsey Landscaping has the following independent cases at the end of the year on December 31, 2014.
a. Each Friday, Lindsey pays employees for the current week's work. The amount of the weekly payroll is $6,500 for a five-day workweek. This year December 31 falls on a Wednesday.
b. Details of Prepaid insurance are shown in the account:
Lindsey prepays a full year's insurance each year on January 1. Record insurance expense for the year ended December 31.
c. The beginning balance of Supplies was $4,200. During the year, Lindsey purchased supplies for $5,100, and at December 31, the supplies on hand total $2,400.
d. Lindsey designed a landscape plan, and the client paid Lindsey $9,000 at the start of the project. Lindsey recorded this amount as Unearned service revenue. The job will take several months to complete, and Lindsey estimates that the company has earned 70% of the total revenue during the current year.
e. Depreciation for the current year includes Equipment, $3,600; and Trucks, $1,400. Make a compound entry.
Requirement
1. Journalize the adjusting entry needed on December 31, 2014, for each of the previous items affecting Lindsey Landscaping.
Lindsey Landscaping has the following independent cases at the end of the year on December 31, 2014.
a. Each Friday, Lindsey pays employees for the current week's work. The amount of the weekly payroll is $6,500 for a five-day workweek. This year December 31 falls on a Wednesday.
b. Details of Prepaid insurance are shown in the account:
Lindsey prepays a full year's insurance each year on January 1. Record insurance expense for the year ended December 31.
c. The beginning balance of Supplies was $4,200. During the year, Lindsey purchased supplies for $5,100, and at December 31, the supplies on hand total $2,400.
d. Lindsey designed a landscape plan, and the client paid Lindsey $9,000 at the start of the project. Lindsey recorded this amount as Unearned service revenue. The job will take several months to complete, and Lindsey estimates that the company has earned 70% of the total revenue during the current year.
e. Depreciation for the current year includes Equipment, $3,600; and Trucks, $1,400. Make a compound entry.
Requirement
1. Journalize the adjusting entry needed on December 31, 2014, for each of the previous items affecting Lindsey Landscaping.
Explanation
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Financial & Managerial Accounting 3rd Edition by Charles Horngren,Harrison, Walter,Suzanne Oliver
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