Indicate the effects that each of the 5 adjusting journal entries will have upon each of the following six sections of the Sunset Vineyards' financial statements.
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a. Sunset Vineyards delivered $60,000 of wine in September to customers who paid in August.
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b. During September Sunset Vineyards used $12,000 worth of glass bottles from its inventory of supplies.
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c. Sunset Vineyards owes $8,000 in wages to its employees at the end of September. Because Sunset pays employees bi-weekly, these wages will not be paid until the first week in October.
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d. Sunset Vineyards shipped $125,000 of wine to its wholesale customers in September. These customers are billed and pay those bills in October.
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e. Sunset Vineyards has a balance of pre-paid insurance of $12,000 at the beginning of September. $4,000 of that insurance was used in September.
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Use the letters to fill in each empty block on the table:
I for Increase; D for Decrease; NE for No Effect
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Income Statement
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Balance Sheet
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Transaction
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Revenue - Expenses = Net Income
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Assets = Liabilities + Owners Equity
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a.
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b.
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c.
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d.
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e.
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