April 1 Stofford Invested $33000 cash and compuner equipment worth $25,000 in th

Question

April 1 Stofford Invested $33000 cash and compuner equipment worth $25,000 in the company 2 The compe 3 The company purchased $1300 of office supplies for cash 0 The company paid $2.300 cash for the premium on a 12-month insurance policy Coverage begins ny rented furnished office space by paying $2,100 cash for the first month's (Apritp)rent on April 11. 14 The company paid $1,500 cash for two weeks' salaries eaned by employees 24 The company collected $12.000 cash on commissions from airlines on tickets obtained for vill ex 28 The company paid $1.500 cash for two weeks' salaries earned by employees. 29 The company paid $300 cash for minor repairs to the company's computer 30 The company paid $1,500 cash for this month's telephone bil 30 Stafford withdrew $2,500 cash from the company for personal use. The company's chart of accounts follows 101 Cash 106 Accounts Recelvable 124 Office Supplies 128 Prepald Insurance 167 Computer Equipment 168 Accumulated Depreclation-Computer Equip. 209 Salarles Payable 301 J. Stafford, Capital 302 J. Stafford. Withdrawals 405 Commissions Earned 612 Depreclation Expense-Computer Equip. 622 Salaries Expense 637 Insurance Expense 640 Rent Expense 650 Office Supplies Expense 684 Repairs Expense 688 Telephone Expense 901 Income Summary Use the following Information; a. Two-thirds of one month's insurance coverage has expired b. At the end of the month, $700 of office supplies are still available. C. This month's depreciation on the computer equipment is $300 d. Employees earned $470 of unpaid and unrecorded salarles as at month-end. e. The company earned $1,800 of commissions that are not yet billed at month-end

Explanation / Answer

Solution:

Adjusting Entries

General Journal

Debit

Credit

a.

Insurance Expense (2300 / 12* 2/3)

$128

Prepaid Insurance

$128

b.

Office Supplies Expense (1300 - 700)

$600

Office Supplies

$600

c.

Depreciation Expense - Computer Equipment

$300

Accumulated Depreciation - Computer Equipment

$300

d.

Salaries Expense

$470

Salaries Payable

$470

e.

Accounts Receivable

$1,800

Commission Earned

$1,800

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General Journal

Debit

Credit

a.

Insurance Expense (2300 / 12* 2/3)

$128

Prepaid Insurance

$128

b.

Office Supplies Expense (1300 - 700)

$600

Office Supplies

$600

c.

Depreciation Expense - Computer Equipment

$300

Accumulated Depreciation - Computer Equipment

$300

d.

Salaries Expense

$470

Salaries Payable

$470

e.

Accounts Receivable

$1,800

Commission Earned

$1,800

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