Exercise 3-8 Danielle Manning, D.D.S., opened a dental practice on January 1, 20
ID: 2504093 • Letter: E
Question
Exercise 3-8 Danielle Manning, D.D.S., opened a dental practice on January 1, 2012. During the first month of operations, the following transactions occurred.
1. Performed services for patients who had dental plan insurance. At January 31, $820 of such services was earned but not yet recorded.
2. Utility expenses incurred but not paid prior to January 31 totaled $603.
3. Purchased dental equipment on January 1 for $84,000, paying $22,700 in cash and signing a $61,300, 3-year note payable. (a) The equipment depreciates $420 per month.
(b) Interest is $613 per month.
4. Purchased a one-year malpractice insurance policy on January 1 for $25,020.
5. Purchased $1,662 of dental supplies. On January 31, determined that $377 of supplies were on hand. Prepare the adjusting entries on January 31. Account titles are: Accumulated DepreciationEquipment, Depreciation Expense, Service Revenue, Accounts Receivable, Insurance Expense, Interest Expense, Interest Payable, Prepaid Insurance, Supplies, Supplies Expense, Utilities Expense and Accounts Payable.
Explanation / Answer
1. Performed services for patients who had dental plan insurance. At January 31, $820 of such services was earned but not yet billed to the insurance companiesDebit Accounts Receivable $820
Credit Service Revenue $820
2. Utility expenses incurred but not paid prior to January 31 totaled $603.
Debit Utilities Expense $603
Credit Utilities Payable $603
3. Purchased dental equipment on January 1 for $84,000, paying $22700 in cash and signing a $61300, 3-year note payable. The equipment depreciates $420 per month. Interest is $613 per month.
Debit Depreciation Expense $420
Credit Accumulated Depreciation- Dental Equipment $420
Debit Interest Expense $613
Credit Interest Payable $613
4. Purchased a one-year malpractice insurance policy on January 1 for $25020.
Debit Insurance Expense $1,000
Credit Prepaid Insurance $1,000
5. Purchased $1,662 of dental supplies. On January 31, determined that $377 of supplies were on hand.
Debit Supplies Expense $1285
Credit Supplies $1285
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.