The ledger of Buerhle, Inc. on March 31, 2012, includes the following selected a

Question

The ledger of Buerhle, Inc. on March 31, 2012, includes the following selected accounts before adjusting entries.




Debit Credit

Prepaid Insurance 2,400
Office Supplies 2,500
Office Equipment 30,000
Unearned Revenue 10,000

An analysis of the accounts shows the following:

1. Insurance expires at the rate of $300 per month.
2. Supplies on hand total $900.
3. The office equipment depreciates $500 per month.
4. 2/5 of the unearned revenue was earned in March.

Prepare the adjusting entries for the month of March.

Explanation / Answer

1. Insurance expires at the rate of $300 per month Dr Insurance expense $300 Cr Prepaid insurance $300 2. Supplies on hand total $900 Dr Office supplies expense $1,600 Cr Office supplies $1,600 3. The office equipment depreciates $500 per month Dr Depreciation expense $500 Cr Acc. Depr.-off equipment $500 4. 2/5 of the unearned revenue was earned in March. Dr Unearned revenue $4,000 Cr Service revenue $4,000

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