On July 31, 2019, after one month of operation, the general ledger of Michael Domenici, Consultant, contained
Fantastic news! We've Found the answer you've been seeking!
Question:
On July 31, 2019, after one month of operation, the general ledger of Michael Domenici, Consultant, contained the accounts and balances given below.
ACCOUNTS AND BALANCES | ||||
Cash | $ | 25,360 | Dr. | |
Accounts Receivable | 1,410 | Dr. | ||
Supplies | 930 | Dr. | ||
Prepaid Rent | 10,050 | Dr. | ||
Prepaid Insurance | 2,040 | Dr. | ||
Prepaid Interest | 388 | Dr. | ||
Furniture | 14,397 | Dr. | ||
Accumulated Depreciation—Furniture | ||||
Equipment | 6,995 | Dr. | ||
Accumulated Depreciation—Equipment | ||||
Notes Payable | 17,400 | Cr. | ||
Accounts Payable | 5,200 | Cr. | ||
Interest Payable | ||||
Unearned Consulting Fees | 5,640 | Cr. | ||
Michael Domenici, Capital | 31,680 | Cr. | ||
Michael Domenici, Drawing | 2,700 | Dr. | ||
Consulting Fees | 8,700 | Cr. | ||
Salaries Expense | 3,900 | Dr. | ||
Utilities Expense | 255 | Dr. | ||
Telephone Expense | 195 | Dr. | ||
Supplies Expense | ||||
Rent Expense | ||||
Insurance Expense | ||||
Depreciation Expense—Furniture | ||||
Depreciation Expense—Equipment | ||||
Interest Expense | ||||
ADJUSTMENTS
- On July 31, an inventory of the supplies showed that items costing $615 were on hand.
- On July 1, the firm paid $10,050 in advance for six months of rent.
- On July 1, the firm purchased a one-year insurance policy for $2,040.
- On July 1, the firm paid $388 interest in advance on a four-month note that it issued to the bank.
- On July 1, the firm purchased office furniture for $14,397. The furniture is expected to have a useful life of eight years and a salvage value of $1,725.
- On July 1, the firm purchased office equipment for $6,995. The equipment is expected to have a useful life of five years and a salvage value of $1,775.
- On July 1, the firm issued a three-month, 6 percent note for $9,200.
- On July 1, the firm received a consulting fee of $5,640 in advance for a one-year period.
Required:
- Prepare a partial worksheet with the following sections: Trial Balance, Adjustments, and Adjusted Trial Balance. Use the data about the firm’s accounts and balances to complete the Trial Balance section.
- Enter the adjustments described above in the Adjustments section.
- Complete the Adjusted Trial Balance section.
Analyze:
By what total amount were the expense accounts of the business adjusted?
Related Book For
College Accounting A Contemporary Approach
ISBN: 978-0077639730
4th edition
Authors: David Haddock, John Price, Michael Farina
Posted Date: