Chapter 3: 18DQ (page 139)
What tasks are aided by a worksheet?
Answer:
Adjusting entries, closing entries, and financial statements are the three tasks which are aided by a work sheet.
Over 22 million students worldwide already upgrade their learning with Vaia!
All the tools & learning materials you need for study success - in one app.
Get started for free
Question: What type of business is most likely to select a fiscal year that corresponds to its natural business year instead of the calendar year?
Question:Prepare year-end adjusting journal entries for M&R Company as of December 31, 2017, for each of the
following separate cases. (Entries can draw from the following partial chart of accounts: Cash; Accounts
Receivable; Interest Receivable; Equipment; Wages Payable; Salary Payable; Interest Payable; Lawn
Services Payable; Unearned Revenue; Revenue; Interest Revenue; Wages Expense; Salary Expense;
Supplies Expense; Lawn Services Expense; Interest Expense.)
a. M&R Company provided \(2,000 in services to customers that are expected to pay the company sometime
in January following the company’s year-end.
b. Wage expenses of \)1,000 have been incurred but are not paid as of December 31.
c. M&R Company has a \(5,000 bank loan and has incurred (but not recorded) 8% interest expense of
\)400 for the year ended December 31. The company will pay the \(400 interest in cash on January 2
following the company’s year-end.
d. M&R Company hired a firm to provide lawn services at a monthly fee of \)500 with payment occurring
on the 15th of the following month. Payment for December services will occur on January 15
following the company’s year-end.
e. M&R Company has earned \(200 in interest revenue from investments for the year ended December
31. The interest revenue will be received on January 15 following the company’s year-end.
f. Salary expenses of \)900 have been earned by supervisors but not paid as of December 31.
In the blank space beside each numbered balance sheet item, enter the letter of its balance sheet classification. If the item should not appear on the balance sheet, enter a Z in the blank.
A. Current assets
B. Long-term investments
C. Plant assets
D. Intangible assets
E. Current liabilities
F. Long-term liabilities
G. Equity
16. Office equipment
Prepare adjusting journal entries for the year ended (date of) December 31, 2017, for each separate situation.
(Entries can draw from the following partial chart of accounts: Cash; Accounts Receivable; Supplies;
Prepaid Insurance; Equipment; Accumulated Depreciation—Equipment; Wages Payable; Unearned Revenue;
Revenue; Wages Expense; Supplies Expense; Insurance Expense; Depreciation Expense—Equipment.)
a. Depreciation on the company’s equipment for 2017 is computed to be \(18,000.
b. The Prepaid Insurance account had a \)6,000 debit balance at December 31, 2017, before adjusting for
the costs of any expired coverage. An analysis of the company’s insurance policies showed that \(1,100
of unexpired insurance coverage remains.
c. The Office Supplies account had a \)700 debit balance on December 31, 2016; and \(3,480 of office
supplies were purchased during the year. The December 31, 2017, physical count showed \)300 of supplies
available.
d. Two-thirds of the work related to \(15,000 of cash received in advance was performed this period.
e. The Prepaid Insurance account had a \)6,800 debit balance at December 31, 2017, before adjusting for the
costs of any expired coverage. An analysis of insurance policies showed that \(5,800 of coverage had expired.
f. Wage expenses of \)3,200 have been incurred but are not paid as of December 31, 2017.
In the blank space beside each numbered balance sheet item, enter the letter of its balance sheet classification. If the item should not appear on the balance sheet, enter a Z in the blank.
A. Current assets
B. Long-term investments
C. Plant assets
D. Intangible assets
E. Current liabilities
F. Long-term liabilities
G. Equity
19. Office supplies
What do you think about this solution?
We value your feedback to improve our textbook solutions.
