Analysis of Adjusted Data Selected T-account balances for Parris Company are sho

Question

Analysis of Adjusted Data Selected T-account balances for Parris Company are shown below as of January 31; adjusting entries have already been posted. The firm uses a calendar-year accounting period and makes monthly adjustments.

a. If the amount in Supplies Expense represents the January 31 adjustment for the supplies used in January, and $635 worth of supplies were purchased during January, what was the January 1 balance of Supplies?

$Answer

b. The amount in the Insurance Expense account represents the adjustment made at January 31 for January insurance expense. If the original insurance premium was for one year, what was the amount of the premium and on what date did the insurance policy start?

$Answer Total premium

AnswerJanuary 1February 1March 1April 1May 1June 1July 1August 1September 1October 1November 1December 1 Policy start date

c. If we assume that no balance existed in Wages Payable or Wages Expense on January 1, how much cash was paid as wages during January?

$Answer

d. If the truck has a useful life of five years, what is the monthly amount of depreciation expense and how many months has Parris owned the truck?

$Answer monthly depreciation

Answer months owned the truck

Explanation / Answer

a) opening + purchases - adjustments = closing balance of supplies x +635-2,540 = 950 x                      = 950+2540-635 2855 answer b) premium = 182*12 2184 answer expired insurance = 2184-910 1274 1274/182 7 7 months expired hence insurance policy start at July 1 answer c) Wages paid in cash 3200-650 2550 answe d) 8700/5 1740 Depreciation expense = 1740 2610/1740 1.5 months owned the truck

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