Auto Supply Co. has been in operation since January, 2008. Selected T-account balances for Auto Supply Co. are shown below as of January 31, 2019. Adjusting entries have already been posted. The firm uses a calendar-year accounting period but prepares monthly adjustments.
a. During January, $4,000 worth of supplies were purchased. If the amount in Supplies Expense represents the January 31 adjustment for the supplies used in January, what was the January 1 beginning balance of Supplies?
b. The insurance premium purchased was valid for one year. The amount in the Insurance Expense account represents the adjustment made at January 31 for January insurance expense. What was the amount of the premium and on what date did the insurance policy start?
c. No beginning balance existed in Wages Payable or Wages Expense on January 1. How much cash was paid as wages during January?
d. The truck has a useful life of five years, what is the monthly amount of depreciation expense and how many months has Auto Supply Co. owned the truck?

Question

Auto Supply Co. has been in operation since January, 2008. Selected T-account balances for Auto Supply Co. are shown below as of January 31, 2019. Adjusting entries have already been posted. The firm uses a calendar-year accounting period but prepares monthly adjustments.
  a. During January, $4,000 worth of supplies were purchased. If the amount in Supplies Expense represents the January 31 adjustment for the supplies used in January, what was the January 1 beginning balance of Supplies?
b. The insurance premium purchased was valid for one year. The amount in the Insurance Expense account represents the adjustment made at January 31 for January insurance expense. What was the amount of the premium and on what date did the insurance policy start?
c. No beginning balance existed in Wages Payable or Wages Expense on January 1. How much cash was paid as wages during January?
d. The truck has a useful life of five years, what is the monthly amount of depreciation expense and how many months has Auto Supply Co. owned the truck?

Quizplus · Accepted Answer

The Answer of Auto Supply Co. has been in operation since January, 2008. Selected T-account balances for Auto Supply Co. are shown below as of January 31, 2019. Adjusting entries have already been posted. The firm uses a calendar-year accounting period but prepares monthly adjustments.
  a. During January, $4,000 worth of supplies were purchased. If the amount in Supplies Expense represents the January 31 adjustment for the supplies used in January, what was the January 1 beginning balance of Supplies?
b. The insurance premium purchased was valid for one year. The amount in the Insurance Expense account represents the adjustment made at January 31 for January insurance expense. What was the amount of the premium and on what date did the insurance policy start?
c. No beginning balance existed in Wages Payable or Wages Expense on January 1. How much cash was paid as wages during January?
d. The truck has a useful life of five years, what is the monthly amount of depreciation expense and how many months has Auto Supply Co. owned the truck?