Exercise 5: Adjustments for Prepaid Expenses Prepare the audit adjustments for the following situations you find...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Exercise 5: Adjustments for Prepaid Expenses Prepare the audit adjustments for the following situations you find in the records of Mabini, Inc. which closes its accounts December 31, 20X7. a) December 1, 20X7: Advertising Expense Cash Records payment of 20X8 advertising contract. b) Balance of Office Supplies Expense at 12/31/20X7, Balance of Office Supplies on Hand at 12/31/20X7 Inventory value of Office Supplies at 12/31/20X7 c) June 1, 20X7 P12,000 Prepaid Insurance Cash P 1,800 Records payment of 36-month policy for fire loss on inventory P12,000 P 5,000 500 750 P 1,800 d) Balance of Factory Supplies Expense Account at 12/31/20X7 Physical inventory of factory supplies at 12/31/20X7 P 3,300 P 1,100 e) On May 1, 20X7, a three-year subscription to the Professional Journal in the amount of P1,800 was mailed in but not paid for. Subscription Expense was charged for the entire amount. f) On September 1, 20X7, paid 36 months premium of P3,600 on fire and extended coverage on building. No amortization of this premium has been recorded to date and the full amount remains in the Prepaid Insurance account. g) Signed a 10-year lease for a new warehouse; the closing costs of P12,000 paid on July 1, 20X7, effective date of lease, was charged to Rent Expense. h) Paid annual dues of P1,200 on September 1, 20X7, to the Chamber of Commerce and charged Dues and Subscription Expense. i) Subscribed to Building Reports on April 1, 20X7, agreeing to pay equal semi-annual installments of P720 each. The first payment was charged to Prepaid Dues and Subscriptions and the second charged to Dues and Subscriptions Expense.. j) Vacation advances were made in the amount of P6,000 on December 15, 20X7, and charged to Vacation Expense. Of this amount P3,000 applies to vacations starting January 1, 20X8. Exercise 5: Adjustments for Prepaid Expenses Prepare the audit adjustments for the following situations you find in the records of Mabini, Inc. which closes its accounts December 31, 20X7. a) December 1, 20X7: Advertising Expense Cash Records payment of 20X8 advertising contract. b) Balance of Office Supplies Expense at 12/31/20X7, Balance of Office Supplies on Hand at 12/31/20X7 Inventory value of Office Supplies at 12/31/20X7 c) June 1, 20X7 P12,000 Prepaid Insurance Cash P 1,800 Records payment of 36-month policy for fire loss on inventory P12,000 P 5,000 500 750 P 1,800 d) Balance of Factory Supplies Expense Account at 12/31/20X7 Physical inventory of factory supplies at 12/31/20X7 P 3,300 P 1,100 e) On May 1, 20X7, a three-year subscription to the Professional Journal in the amount of P1,800 was mailed in but not paid for. Subscription Expense was charged for the entire amount. f) On September 1, 20X7, paid 36 months premium of P3,600 on fire and extended coverage on building. No amortization of this premium has been recorded to date and the full amount remains in the Prepaid Insurance account. g) Signed a 10-year lease for a new warehouse; the closing costs of P12,000 paid on July 1, 20X7, effective date of lease, was charged to Rent Expense. h) Paid annual dues of P1,200 on September 1, 20X7, to the Chamber of Commerce and charged Dues and Subscription Expense. i) Subscribed to Building Reports on April 1, 20X7, agreeing to pay equal semi-annual installments of P720 each. The first payment was charged to Prepaid Dues and Subscriptions and the second charged to Dues and Subscriptions Expense.. j) Vacation advances were made in the amount of P6,000 on December 15, 20X7, and charged to Vacation Expense. Of this amount P3,000 applies to vacations starting January 1, 20X8.
Expert Answer:
Related Book For
College Accounting A Contemporary Approach
ISBN: 978-0077639730
3rd edition
Authors: David Haddock, John Price, Michael Farina
Posted Date:
Students also viewed these accounting questions
-
A physical inventory of Office Deals taken at December 31 reveals the following. Required 1. Compute the lower of cost or market for the inventory applied separately to each item. 2. If the market...
-
A physical inventory of Office Necessities taken at December 31 reveals the following. Required 1. Compute the lower of cost or market for the inventory applied separately to each item. 2. If the...
-
A physical inventory of Office Mart taken at December 31 reveals the following. Required Compute the lower of cost or market for the inventory (a) As a whole, (b) By major category, (c) Applied...
-
For the following exercises, find the inverse of the functions. f(x): || 3 x-4
-
The Pentagon is constantly seeking ways to procure the most effective combat equipment and systems at the lowest possible cost. A key element in most procurement contracts is fixed fee based on...
-
Suppose that f (t) is the half-wave rectification of sin kt , shown in Fig. 10.5.15. Show that L{f(t)} = k (s2+k)(1-e-ns/k)*
-
Between February 2020 and April 2020, the labor force participation rate for people ages 20 to 24 declined by 8.7 percentage points. The labor force participation rate for people ages 25 to 54...
-
Jarod Douglas Jones is a young professional just getting started in the world. He has been having some difficulty getting his checkbook to match his bank statement. Last month all he had to do was...
-
a) Explain any three reasons why some businesses do not maintain a complete set of accounting records. (3 marks) b) On 31.12.2017, subscriptions paid in advance to Amani sports Club amounted sh....
-
An examination of the cash activities during the year shows the following. GREAT ADVENTURES Cash Account Records July 1, 2024, to December 31, 2024 Date 7/1 7/15 7/22 7/30 8/1 8/10 8/17 9/21 10/17...
-
NAME Pgage A1 A2 A3 A4 A5 A6 A7 A8 A9 A10 All Z1 (mmH2O) (mm) 235 214 196 179 157 137 119 98 77 56 36 make 0 40 80 120 160 200 240 280 320 360 400 Z2 (mm) 235 Pu 255 275 295 314 334 350 369 388 409...
-
Brooklyn files as a head of household for 2019. She claimed the standard deduction of $18,350 for regular tax purposes. Her regular taxable income was $80,000. What is Brooklyns AMTI?
-
What is commercial paper?
-
Greengrass Mowing Service had operating expenses for the year of $60 000. At the beginning of the year, Greengrass owed $15 000 on accrued liabilities. The closing balance of accrued liabilities was...
-
Suppose Amazon stock is trading for $70 per share, and Amazon pays no dividends. a. What is the maximum possible price of a call option on Amazon? b. What is the maximum possible price of a put...
-
Bribery of foreign public officials, conspiracy to commit fraud and forgery, money laundering, possessing property obtained by crime, and attempts to secretly smuggle the son of a former dictator...
-
Companies A and B have operating profits of $1,000 and $1,200, respectively. The companies get a final profit of Rp. 800 and Rp. 720. The assets used by the two companies are the same, namely Rp....
-
One hundred pounds of water at atmospheric pressure are heated from 60F to 200F. What is the enthalpy change? The internal energy change? Why is the difference between the internal energy change and...
-
What are the four bases for determining employee gross earnings?
-
Obtain all data that is necessary from the worksheet prepared for Whatnots in Problem 12.5B at the end of Chapter 12. Then follow the instructions to complete this problem. In Problem 12.5B ACCOUNTS...
-
The Appliance Store began operations March 1, 2016. The firm sells its merchandise for cash and on open account. Sales are subject to a 6 percent sales tax. During March, The Appliance Store engaged...
-
By conducting testcrosses, researchers have found that the sweet pea plant has seven linkage groups. How many chromosomes would you expect to find in leaf cells of sweet pea plants?
-
Describe the unique features of ascomycetes that facilitate genetic analysis of these fungi.
-
Though we often think of genes in terms of the phenotypes they produce (e.g., curly leaves, flaky tail, brown eyes), the molecular function of most genes is to encode proteins. Many cellular proteins...
Study smarter with the SolutionInn App