Adjusting Entries
The following accounts were taken from the trial balance of Cristy Company as of December 31, 2008:
|
Sales
|
$90,000
|
|
Interest Revenue
|
5,000
|
|
Equipment
|
46,000
|
|
Accumulated Depreciation-Equipment
|
12,000
|
|
Inventory
|
20,000
|
|
Advertising Expense
|
2,000
|
|
Selling Expense
|
6,000
|
|
Interest Expense
|
1,000
|
Given the information below, make the necessary adjusting entries.
(a) The equipment has an estimated useful life of nine years and a salvage value of $1,000. Depreciation is calculated using the straight-line method.
(b) Of selling expense, $2,500 has been paid in advance.
(c) Interest of $750 has accrued on notes receivable.
(d) Of advertising expense, $620 was incorrectly debited to selling expense.