wages journal iger Company completed the following transactions. The annual acco

Question

wages journal iger Company completed the following transactions. The annual accounting period ends December 31. Jan. 3 Purchased merchandise on account at a cost of $30,000. (Assume a perpetual inventory system.) Jan. 27 Paid for the January 3 purchase. June 13 Purchased merchandise on account at a cost of $9,200 July 25 Paid for the June 13 purchase. Aug. 1 Rented out a small office in a building owned by Tiger Company and collected eight months a 12-month, 8.0 percent promissory note. rent in advance amounting to $9,200. (Use an account called Uneaned Rent Revenue.) taxes) Dec. 31 Determined wages of $18,000 were eaned but not yet paid on December 31 (ignore payroll Dec. 31 Adjusted the accounts at year-end, relating to interest Dec. 31 Adjusted the accounts at year-end, relating to rent

Explanation / Answer

2. Adjusting entries

3.

Date Account Name Debit Credit Dec 31 Wage expense $18000 Salaries and Wages payable $18000 Dec 31 Interest expense ($86000 x 8% x 9/12) 5160 Interest payable 5160 Dec 31 Unearned rent revenue ($9200 x 5/8) 5750 Rent revenue 5750

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