Exercise 3-10 (Part Level Submission)

Teal Resort opened for business on June 1 with eight air-conditioned units. Its trial balance on August 31 is as follows.

Other data:

1.		The balance in prepaid insurance is a one-year premium paid on June 1, 2017.
2.		An inventory count on August 31 shows $438 of supplies on hand.
3.		Annual depreciation rates are (a) buildings (4%) (b) equipment (10%). Salvage value is estimated to be 10% of cost.
4.		Unearned Rent Revenue of $3,866 was earned prior to August 31.
5.		Salaries of $357 were unpaid at August 31.
6.		Rentals of $819 were due from tenants at August 31. (Use Accounts Receivable account.)
7.		The mortgage interest rate is 8% per year.

Journalize the adjusting entries on August 31 for the 3-month period June 1August 31.

TEAL RESORT TRIAL BALANCE AUGUST 31, 2017 Debit Credit Cash Prepaid Insurance Supplies $25,600 10,500 8,600 30,000 130,000 26,000 Land Buildings Equipment Accounts Payable Unearned Rent Revenue Mortgage Payable Common Stock Retained Earnings Dividends Rent Revenue Salaries and Wages Expense Utilities Expenses Maintenance and Repairs Expense Totals $10,500 10,600 70,000 107,000 9,000 5,000 86,200 44,800 9,200 3,600 $293,300 $293,300