Reference no: EM132736812

X Company, a merchandiser, prepares monthly financial statements. On September 30, its accountant made adjusting entries to record:

1. $5,831 of September interest on a bank loan to be paid in October
2. $1,577 of wages that were earned by employees in September but to be paid in October
3. $4,806 of rent and insurance for September that was prepaid on September 1 but had expired
4. $3,698 of depreciation on factory equipment
5. a $2,869 September utility bill received in September, to be paid in October
6. a shipment of products in September for which customers paid $1,250 in August

Problem 1: What would be the effect of these entries on total assets in September?

A: $-4,354

B: $-5,443

C: $-6,803

D: $-8,504

E: $-10,630

F: $-13,288

Problem 2: What would be the effect of these entries on total liabilities in September?

A: $4,117

B: $4,817

C: $5,636

D: $6,594

E: $7,715

F: $9,027