In each of the following transactions (a) through (c) for Catena's Marketing Company, indicate the effect...

Transcribed Image Text:

In each of the following transactions (a) through (c) for Catena's Marketing Company, indicate the effect of the adjusting entry on the elements of the balance sheet and income statement. Note: Reductions in account balances should be indicated with a minus sign. a. Collected $2,000 rent for the period December 1 of the current year to April 1 of next year, which was credited to Unearned Rent Revenue on December 1. b. Purchased a machine for $38,000 cash on January 1. The company estimates annual depreciation at $4,500. c. Paid $3,800 for a two-year insurance premium on July 1 of the current year; debited Prepaid Insurance for that amount. Transaction a. b. C. Assets Balance Sheet Liabilities Stockholders' Equity Revenues Income Statement Expenses Net Income In each of the following transactions (a) through (c) for Catena's Marketing Company, indicate the effect of the adjusting entry on the elements of the balance sheet and income statement. Note: Reductions in account balances should be indicated with a minus sign. a. Collected $2,000 rent for the period December 1 of the current year to April 1 of next year, which was credited to Unearned Rent Revenue on December 1. b. Purchased a machine for $38,000 cash on January 1. The company estimates annual depreciation at $4,500. c. Paid $3,800 for a two-year insurance premium on July 1 of the current year; debited Prepaid Insurance for that amount. Transaction a. b. C. Assets Balance Sheet Liabilities Stockholders' Equity Revenues Income Statement Expenses Net Income

Answer rating: 100% (QA)

The image depicts an accounting exercise and is asking to indicate the effects of the adjusting entry on the balance sheet and income statement elemen... View the full answer