Jack Johnson is the sole proprietor of Kitwanga Seasonal Fisheries and Landscaping (KSFL). KSFL operates in the

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Jack Johnson is the sole proprietor of Kitwanga Seasonal Fisheries and Landscaping (KSFL). KSFL operates in the traditional territories of the Gitxsan First Nation in northern British Columbia. Jack has collected the following data for the December 31 adjusting entries: 

a. Each Friday, KSFL pays employees for the current week’s work. The amount of the weekly payroll is $8,000 for a 5-day workweek. This year, December 31 falls on a Tuesday. KSFL will pay its employees on January 3.

b. On January 1 of the current year, KSFL purchases an insurance policy that covers 2 years, $8,000.

c. The beginning balance of Office Supplies was $4,300. During the year, KSFL purchased office supplies for $5,600, and at December 31 the office supplies on hand total $1,500.

d. During December, KSFL designed a landscape plan, and the client prepaid $6,500. KSFL recorded this amount as Unearned Revenue. The job will take several months to complete, and KSFL estimates that the company has earned 40 percent of the total revenue during the current year.

e. At December 31, KSFL had earned $3,000 for landscape services completed for Turnkey Appliances. Turnkey has stated that it will pay KSFL on January 10.

f. Amortization for the current year includes Equipment, $3,000, and Trucks, $2,200.

g. KSFL has incurred $250 of interest expense on a $550 interest payment due on January 15.


Required

1. Journalize the adjusting entry needed on December 31 for each of the previous items affecting Kitwanga Seasonal Fisheries and Landscaping. Assume KSFL records adjusting entries only at the end of the year.

2. Journalize the subsequent journal entries for adjusting entries a, d, and g.

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Related Book For  answer-question

Horngrens Accounting Volume 1

ISBN: 9780136889373

12th Canadian Edition

Authors: Tracie Miller Nobles, Brenda Mattison, Ella Mae Matsumura

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