Prepare adjusting entries for the seven items described


Verne Cova Company has the following balances in selected accounts on December 31, 2017.

Accounts Receivable

$0

Accumulated Depreciation-Equipment

0

Equipment

7,000

Interest Payable

0

Notes Payable

11,000

Prepaid Insurance

2,820

Salaries and Wages Payable

0

Supplies

2,700

Unearned Service Revenue

31,200

All the accounts have normal balances. The information below has been gathered at December 31, 2017.

1. Verne Cova Company borrowed $10,500 by singing a 12%, one-year note on September 1, 2017.

2. A count of supplies on December 31, 2017, indicates that supplies of $850 are on hand.

3. Depreciation on the equipment for 2017 is $1,900.

4. Verne Cova Company paid $2,820 for 12 months of insurance coverage on June 1, 2017.

5. On December 1, 2017, Verne Cova collected $31,200 for consulting services to be performed form December 1, 2017, through March 31, 2018.

6. Verne Cova Company pays its employees total salaries of $5,500 every Monday for the preceding 5-day week (Monday through Friday). On Monday, December 29, employees were paid for the week ending December 26. All employees worked the last 3 days of 2017.

Prepare adjusting entries for the seven items described above.

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Accounting Basics: Prepare adjusting entries for the seven items described
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