Waverly Corporation encounters the following situations: 1. Wave

Waverly Corporation encounters the following situations:

1. Waverly collects $1,750 from a customer in 2014 for services to be performed in 2015.

2. Waverly incurs utility expense which is not yet paid in cash or recorded.

3. Waverly employees worked 3 days in 2014 but will not be paid until 2015.

4. Waverly performs services for a customer but has not yet received cash or recorded the transaction.

5. Waverly paid $2,400 rent on December 1 for the 4 months starting December 1.

6. Waverly received cash for future services and recorded a liability until the service was performed.

7. Waverly performed consulting services for a client in December 2014. On December 31, it had not billed the client for services provided of $1,200.

8. Waverly paid cash for an expense and recorded an asset until the item was used up.

9. Waverly purchased $750 of supplies in 2014; at year-end, $400 of supplies remain unused.

10. Waverly purchased equipment on January 1, 2014; the equipment will be used for 5 years.

11. Waverly borrowed $10,000 on October 1, 2014, signing an 8% one-year note payable.


Instructions

Identify what type of adjusting entry (prepaid expense, unearned revenue, accrued expense, or accrued revenue) is needed in each situation, at December 31, 2014.


Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...

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