FENSKE COMPANY Adjusted Trial Balance January 31, 2012 Debit Credit Supplies $ 7
ID: 2351747 • Letter: F
Question
FENSKE COMPANYAdjusted Trial Balance
January 31, 2012
Debit Credit
Supplies $ 700
Prepaid Insurance 1,560
Salaries and Wages Payable $1,060
Unearned Service Revenue 750
Supplies Expense 950
Insurance Expense 520
Salaries and Wages Expense 1,800
Service Revenue 2,000
Instructions
Answer these questions, assuming the year begins January 1.
(a) If the amount in Supplies Expense is the January 31 adjusting entry, and $300 of
supplies was purchased in January, what was the balance in Supplies on January 1?
(b) If the amount in Insurance Expense is the January 31 adjusting entry, and the original insurance premium was for 1 year, what was the total premium and when was
the policy purchased?
(c) If $2,500 of salaries was paid in January, what was the balance in Salaries and Wages
Payable at December 31, 2011?
(d) If $1,800 was received in January for services performed in January, what was the
balance in Unearned Service Revenue at December 31, 2011?
E4-14 A partial adjusted trial balance for Fenske Company is given in E4-13.
Instructions
Prepare the closing entries at January 31, 2012.
Explanation / Answer
the above question can BE SOLVED by fOLLOWING method. Ie (a) If the amount in Supplies Expense is the January 31 adjusting entry, and $300 of supplies was purchased in January, what was the balance in Supplies on January 1? 300+950=1250 (b) If the amount in Insurance Expense is the January 31 adjusting entry, and the original insurance premium was for 1 year, what was the total premium and when was the policy purchased? 520*12 = 6240 original policy amount; 1560/520 = 3 months remaining in the one year policy, so it was purchased on May 1 of last year. (c) If $2,500 of salaries was paid in January, what was the balance in Salaries and Wages Payable at December 31, 2011? x + 1800 - 1060 = 2500 x + 740 = 2500 x = 1760 beginning balance in salaries and wages payable (d) If $1,800 was received in January for services performed in January, what was the balance in Unearned Service Revenue at December 31, 2011? 2000 revenue -1800 received means that 200 of revenue chance is from the balance in unearned fees. Which means that the beginning unearned service revenue balance was 750-200 = 550 E4-14 A partial adjusted trial balance for Fenske Company is given in E4-13. Instructions Prepare the closing entries at January 31, 2012. Service revenue DEBIT 2000 Income summary CREDIT 2000 Income summary DEBIT 3270 Supplies Expense CREDIT 950 Insurance Expense CREDIT 520 Salaries and Wages Expense CREDIT 1,800 Capital DEBIT (or retained earnings) 1270 Income summary CREDIT 1270 Fourth closing entry not necessary because no dividends or drawings.
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