Chapter 3: Q1PSB_7 (page 156)
For each of the following journal entries 1through 12,enter the letter of the explanation that most closely
describes it in the space beside each entry. (You can use letters more than once.)
A. To record payment of a prepaid expense.
B. To record this period’s use of a prepaid expense.
C. To record this period’s depreciation expense.
D. To record receipt of unearned revenue.
E. To record this period’s earning of prior
unearned revenue.
F. To record an accrued expense.
G. To record payment of an accrued expense.
H. To record an accrued revenue.
I. To record receipt of accrued revenue.
______ 1. Interest Receivable 3,500
Interest Revenue . 3,500
______ 2. Salaries Payable . 9,000
Cash . 9,000
______ 3. Depreciation Expense 8,000
Accumulated Depreciation . 8,000
______ 4. Cash 9,000
Unearned Professional Fees 9,000
______ 5. Insurance Expense . 4,000
Prepaid Insurance . 4,000
______ 6. Interest Expense 5,000
Interest Payable 5,000
______ 7. Cash 1,500
Accounts Receivable (from services) . 1,500
______ 8. Salaries Expense 7,000
Salaries Payable 7,000
______ 9. Cash 1,000
Interest Receivable . 1,000
______ 10. Prepaid Rent . 3,000
Cash . 3,000
______ 11. Rent Expense 7,500
Prepaid Rent 7,500
______ 12. Unearned Professional Fees . 6,000
Professional Fees Earned . 6,000
Short Answer
Option I is correct.
Step by step solution
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