Heald's Variety Store is completing the accounting process for the year just ended, December 31, 2011. The transactions during 2011 have been journalized and posted. The following data with respect to adjusting entries are available:a. Office supplies on hand at January 1, 2011, totaled $350. Office supplies purchased and debited to Office Supplies during the year amounted to $500. The

This problem has been solved!


Do you need an answer to a question different from the above? Ask your question!
Heald's Variety Store is completing the accounting process for the year just ended, December 31, 2011. The transactions during 2011 have been journalized and posted. The following data with respect to adjusting entries are available:
a. Office supplies on hand at January 1, 2011, totaled $350. Office supplies purchased and debited to Office Supplies during the year amounted to $500. The year-end count showed $275 of supplies on hand.
b. Wages earned by employees during December 2011, unpaid and unrecorded at December 31, 2011, amounted to $2,200. The last payroll was December 28; the next payroll will be January 6, 2012.
c. Three-fourths of the basement of the store is rented for $1,600 per month to another merchant, M. Dittman Inc. Dittman sells compatible, but not competitive, merchandise. On November 1, 2011, the store collected six months' rent in the amount of $9,600 in advance from Dittman; it was credited in full to Unearned Rent Revenue when collected.
d. The remaining basement space is rented to Kathy's Specialty Shop for $480 per month, payable monthly. On December 31, 2011, the rent for November and December 2011 had not been collected or recorded. Collection is expected January 10, 2012.
e. The store used delivery equipment that cost $30,500; $6,100 was the estimated depreciation for 2011.
f. On July 1, 2011, a two-year insurance premium amounting to $2,200 was paid in cash and debited in full to Prepaid Insurance. Coverage began on July 1, 2011.
g. Heald's operates a repair shop to meet its own needs. The shop also does repairs for M. Dittman.
At the end of December 31, 2011, Dittman had not paid $800 for completed repairs. This amount has not yet been recorded as Repair Shop Revenue. Collection is expected during January 2012.

Required:
1. Identify each of these transactions as an unearned revenue, prepaid expense, accrued revenue, or accrued expense.
2. Record the adjusting entry that should be recorded for Heald's at December 31, 2011.

Related Book For answer-question

Financial Accounting

6th Edition

Authors: Libby, Short

ISBN: 978-0073526881