16. At December 1, 2017, Stanford Company’s accounts receivable balance was $2,5

Question

16. At December 1, 2017, Stanford Company’s accounts receivable balance was $2,500. During December, Stanford had credit revenues of $7,000 and collected accounts receivable of $3,500. At December 31, 2017, the accounts receivable balance is

a. $6,000 debit.
b. $6,600 debit.
c. $6,000 credit.
d. $6,600 credit.

18. Which of the following journal entries is recorded correctly and in the standard format?
a. Salaries and Wages Expense   500
  Cash    1,500
Advertising Expense .  1,000

b. Salaries and Wages Expense   500
Advertising Expense   1,000
  Cash .   1,500

c. Salaries and Wages Expense .   500
Advertising Expense .   1,000
  Cash   1,500

d. Cash   1,500
  Salaries and Wages Expense    500
  Advertising Expense    1,000

26. Meat Puppets Company purchased equipment for $7,200 on December 1. It is estimated that annual depreciation on the equipment will be $1,800. If financial statements are to be prepared on December 31, the company should make the following adjusting entry:
a. Debit Depreciation Expense, $1,800; Credit Accumulated Depreciation, $1,800.
b. Debit Depreciation Expense, $150; Credit Accumulated Depreciation, $150.
c. Debit Depreciation Expense, $5,400; Credit Accumulated Depreciation, $5,400.
d. Debit Equipment, $7,200; Credit Accumulated Depreciation, $7,200.

27. At December 31, 2015, before any year-end adjustments, Murmur Company's Insurance Expense account had a balance of $2,450 and its Prepaid Insurance account had a balance of $3,800. It was determined that $2,800 of the Prepaid Insurance had expired. The adjusted balance for Insurance Expense for the year would be
a. $2,450.
b. $3,450.
c. $2,800.
d. $5,250.

28. Fugazi City College sold season tickets for the 2015 football season for $240,000. A total of 8 games will be played during September, October and November. In September, three games were played. The adjusting journal entry at September 30
a. is not required. No adjusting entries will be made until the end of the season in November.
b. will include a debit to Cash and a credit to Ticket Revenue for $60,000.
c. will include a debit to Unearned Ticket Revenue and a credit to Ticket Revenue for $90,000.
d. will include a debit to Ticket Revenue and a credit to Unearned Ticket Revenue for $80,000.

Explanation / Answer

16) Ending balance of account receivable = 2500+7000-3500 = 6000 Debit

So answer is a) $6000 Debit

18) Journal entry :

So answer is b)

26) Adjusting entry :

So anwswer is b) Debit Depreciation Expense, $150; Credit Accumulated Depreciation, $150.

27) Adjusted insurance expense = 2450+(3800-2800) = 3450

So answer is b) $3450

28) Adjusting entry :

Amount = 240000/8*3 = 90000

So answer is c) will include a debit to Unearned Ticket Revenue and a credit to Ticket Revenue for $90,000.

Date account and explanation debit credit Salaries and Wages Expense 500 Advertising expense 1000 Cash 1500

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