Final

Question $12-$ Final $-$ Connect

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$12$

All associated information and instructions for the Chapter $11$ case are presented between pages $706$ and $713$ in the text. The steps for setting up a new company in Section $11\mathrm{.}3($pages $706$ to $713)$ must be attempted before attempting any of the following questions.

Adjusting entries are required to bring the accounts up to date to reflect the correct account balances before we prepare financial reports.

If we use the accrual basis of accounting to calculate profits, the following four types of adjusting entries may be necessary.

Prepaid items. Items that are prepaid, such as prepaid insurance or prepaid rent.

Unearned items. Items that a customer has paid us for, but we have not provided the product or service.

Accrued expenses. Expenses that are incurred but not yet paid or recorded.

Accrued revenues. Revenues that have been earned but not yet collected or recorded.

For more detailed information about adjusting entries, see Chapter $9.$

Make adjusting entries for Mookie The Beagle Coach at February $29,2024,$ using the following information.

Adjustment number $1$

Adjustment $1$: One month of liability insurance has expired as of February $29,2024.$

Recall that on $02/01/2024,$ $$1,200$ was paid in advance for six months of liability insurance, and the entire amount was recorded as an expense. Adjust as appropriate.

Adjustment number $2$

Adjustment $2$: A count of office supplies revealed $$800$ of supplies on hand at February $29,2024.$

Recall that the entire amount for Office Supplies was expensed during the month. Adjust as appropriate.

Adjustment $3$: On $02/27/2024$ Mookie The Beagle Coach invoiced Carlos Xafra $$1,800$ and recorded sales of $$1,800$ for an agility training class for Bella that will not occur until March. Because we are using the accrual basis, at February $29,2024,$ the $$1,800$ amount should be recorded as Unearned Revenue since it will not be earned until the month of March.

To enter an adjusting entry using the QBO Journal:

Select $(+)$ New icon

Select Journal Entry to access the onscreen Journal

Enter Journal Date: $02/29/2024$

Enter Journal Number: Adjustment $1$

On Line $1,$ from the drop$-$down list of accounts to debit, select Account to Debi

Do all three adjustment enteries please