ACC120 Lecture 3: Chapter 3 b

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greenmuskrat329

4 Feb 2019

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An asset account (to decrease: examples: supplies, rent, insurance, the allocation of the cost of long-lived assets to expense over their useful lives. The portion of the asset that is used up (or expires) in each. Depreciation period is reported as an expense: straight-line depreciation: Accumulated depreciation (to increase: contra asset account: an account with the opposite balance (credit) compared to its related asset account. Deducted from its related asset on the balance sheet. Depreciation presentation on the balance sheet: accumulated depreciation is deducted from the cost of the asset, this difference is called the carrying amount, cash received before revenue is earned is recorded as a liability. Unearned revenues: subsequently earned by performing a service or providing a good, prior to adjustment, liabilities are overstated and revenues are, adjusting entry: understated. A revenue account (to increase: examples: subscriptions, customer deposits. Adjusting entries - accruals: required where items are not yet recorded in the accounts, accrued revenues, accrued expenses:

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Account Tracking form provided:

Account Title -> copy the name of the accounts from the listbelow

Account Major Classification -> Asset (A), Liability (L),Ownerâs Equity (OE), Revenue (R) or Expense (E) or Not Applicable(NA)

Contra account -> place a check mark in this column if theitem is a contra account

Account Sub Classification -> only to be used with Asset andLiability accounts; Current Asset (CA); Property, Plant &Equipment (PPE); Current Liability (CL), Long-term Liability (LTL)or Not Applicable (NA)

Normal Balance -> debit (DR), credit (CR) or Not Applicable(NA)

Financial Statement-> Income Statement (IS), Statement ofOwnerâs Equity (SOE), Balance Sheet (BS) or Not Applicable (NA)

Temporary or Permanent -> T for temporary (nominal) accountsand P for permanent (real) accounts

Accounts Payable

Accounts Receivable

Accumulated Depreciation

Advertising Expense

Buildings

Cash

Depreciation Expense

Fees Earned

Income Summary

Insurance Expense

Interest Payable (due in 1 month)

Interest Receivable (due in 2 months)

Joey Bee, Capital

Joey Bee, Drawing

Land

Notes Payable (due in 3 years)

Notes Receivable (due in 2 months)

Office Equipment

Prepaid Insurance

Prepaid Rent

Rent Expense

Notes Payable (due in 2 months)

Store Equipment

Supplies

Supplies Expense

Taxes Payable (due in 4 months)

Unearned Fees

Unearned Rent

Unearned Revenue

Wages Payable

goldkangaroo10

1. On the âAJEâ worksheet, prepare the adjusting journal entriesin good form for the following items. Identify each entry by letterin Column B. Round all answers to the nearest dollar. You may omitexplanations. Leave a blank row between each journal entry. All theaccounts you need are given on the worksheet. Use only theseaccounts. Prepare journal entries and financial statements for theyear ended December 31, 2017. No adjusting entries have been madesince December 31, 2016. Do not use "Cash" account only onebalance sheet account and one income statementaccount.

d. Store supplies totaling $14,800 were purchased during theyear and were immediately expensed. A physical count of the storesupplies on hand December 31, 2017, indicates a balance of$2,100.

The entry im asking you to make IS the adjustingentry.

This is the only other information i have!

Grizzlies,Inc.

Worksheet

For the Year Ended December31, 2017

Accumulated Depreciation - StoreEquipment

13,200

Office Equipment

32,000

Accumulated Depreciation - OfficeEquipment

Unearned Consulting Revenue

14,000

Unearned Rent Revenue

Sales Salaries Expense

275,000

Office Salaries Expense

150,000

Miscellaneous Administrative Expense

5,650

Miscellaneous Selling Expense

13,900

Depreciation Expense - StoreEquipment

Depreciation Expense - OfficeEquipment

Store Supplies Expense

17,500

Shop Supplies Expense

Rent Expense

Insurance Expense

Interest Expense

Utilities Expense-Store

Utilities Expense-Office

2,179,050

carminehound970

QUESTION 1 Which of the following is considered in computing depreciation expense using the straight-line method? A. Net income of the company B. Balance in accumulated depreciation C. Asset's fair value D. Cost of inventory produced by equipment E. Asset's historical cost

QUESTION 2 Which of the following methods of depreciation allocates an equal expense to each period in which the asset is used to generate revenue? A. The sum-of-years' digits method B. The units-of-production method C. The double-declining balance method D. The straight-line method E. The activity depreciation method

QUESTION 3 What type of an account is accumulated depreciation? A. Expense B. Equity C. Loss D. Liability E. Contra asset

4 Which of the following accounting principles dictates that an asset's cost should be expensed over its useful life? A. Matching B. Revenue recognition C. Going concern D. Conservatism E. Consistency 1

QUESTION 5 Opine Company uses the double-declining-balance method of depreciation. It purchases a building with a cost of $560,000, a salvage value of $32,000 and a useful life of 16 years. What is the depreciation expense for the second year? A. $61,250 B. $60,000 C. $57,750 D. $70,000 E. $66,000

QUESTION 6 Clark Company acquired a desk for $500. The estimated salvage value is $50 and the estimated life is 5 years. What journal entry should Clark make to record depreciation expense? A. Depreciation Expense 100 Desk 100 B. Depreciation Expense 90 Desk 90 C. Accumulated Depreciation 90 Depreciation Expense 90 D. Depreciation Expense 90 Accumulated Depreciation 90 E. Depreciation Expense 100 Accumulated Depreciation 100

QUESTION 7 Jacobs Company estimates that its new equipment will last 6 years and have a residual value of $3,000. The original cost of the equipment was $39,000. What would be the balance in the accumulated depreciation account at the end of year 4? A. $0 B. $26,000 C. $24,000 D. $39,000 E. $6,000

QUESTION 18 Which of the following accounts will be shown on the balance sheet with accumulated depreciation account? A. Building B. Prepaid rent C. Cash D. Land E. Goodwill

coralhippopotamus930

ACC120 Lecture 3: Chapter 3 b

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