Badger Digging Company's year-end is August 31. Based on an analysis of the unadjusted trial balance at August 31, 2022, the following information was available for the preparation of adjusting entries:

 

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The prepaid rent account showed a balance of $4,500. This was paid on August 1, 2022 and represents 3 months rent starting on that date. (a) A client paid $800 for services to be provided equally over four months beginning May 1, 2022. This amount was credited to the unearned revenue account. (b) The one employee is paid bi-weekly, and on August 31, salaries of $775 have accrued but not been recorded. (c) Services performed but unrecorded and uncollected at August 31 total $1,950. (d) Interest of $50 had accrued but not been recorded on the note receivable (e) as at August 31. The prepaid insurance account shows a balance of $1,500, the amount paid for a one year insurance policy purchased on June 1, 2022. The supplies account has an unadjusted balance of $685. A count shows $445 of supplies have now been used. (g) The August utilities bill arrived after ths unadjusted trial balance was prepared, and its $133 amount has not been paid or recorded. (h) (1) Estimated annual depreciation on the machine is $1,300. Required: Prepare annual adjusting journal entries on August 31, 2021 in the General Journal provided. Please put the letter of the entry in the date column. The prepaid rent account showed a balance of $4,500. This was paid on August 1, 2022 and represents 3 months rent starting on that date. (a) A client paid $800 for services to be provided equally over four months beginning May 1, 2022. This amount was credited to the unearned revenue account. (b) The one employee is paid bi-weekly, and on August 31, salaries of $775 have accrued but not been recorded. (c) Services performed but unrecorded and uncollected at August 31 total $1,950. (d) Interest of $50 had accrued but not been recorded on the note receivable (e) as at August 31. The prepaid insurance account shows a balance of $1,500, the amount paid for a one year insurance policy purchased on June 1, 2022. The supplies account has an unadjusted balance of $685. A count shows $445 of supplies have now been used. (g) The August utilities bill arrived after ths unadjusted trial balance was prepared, and its $133 amount has not been paid or recorded. (h) (1) Estimated annual depreciation on the machine is $1,300. Required: Prepare annual adjusting journal entries on August 31, 2021 in the General Journal provided. Please put the letter of the entry in the date column.

Answer rating: 100% (QA)

Journal entry No Particulars Debit Credit 1 prepaid Insurance 4500 To Insurance expense 4500 2 ... View the full answer