Kidman Company prepares monthly financial statements. Below are listed some selected accounts and their balances in the
Question:
- Kidman Company prepares monthly financial statements. Below are listed some selected accounts and their balances in the September30 trial balance before any adjustments have been made for the month of September.
KIDMAN COMPANY
Trial Balance (Selected Accounts)
September 30, 2016
———————————————————————————————————————————
Debit Credit
Supplies................................................................................................... $ 3,200
Prepaid Insurance.................................................................................... 4,200
Equipment................................................................................................ 16,200
Accumulated Depreciation—Equipment.................................................. $1,000
Unearned Rent Revenue......................................................................... 1,200
(Note: Debit column does not equal credit column because this is a partial listing of selected account balances)
An analysis of the account balances by the company’s accountant provided the following additional information:
1. A physical count of supplies revealed $1,400 on hand on September 30.
2. A two-year life insurance policy was purchased on June 1 for $3,600.
3. Equipment depreciated$3,300 per year.
4. The amount of rent received in advance that remains unearned at September 30 is$700.
Instructions
Using the above additional information, prepare the adjusting entries that should be made by Kidman Company on September 30.
Business Research Methods
ISBN: 978-0073521503
12th edition
Authors: Donald R. Cooper, Pamela S. Schindler