Reference no: EM132653348

Question - Prepare the adjusting entries. Assume a calendar year.

1. Dennis Company purchased an asset at the start of the current year for $500,000. There is an estimated residual value of $75,000. The expected life of the asset is 5 years. Use the Straight-Line Deprecation Method to solve this, and then prepare journal entries to record depreciation.

2. On September 1, 2022, Clay Company borrowed 200,000 from its bank by issuing a 5%, 8-month note payable, with interest to be paid on the maturity date. What would be the correct entry the company would make for the year-end?

3. The trial balance showed $12,500 for Prepaid Insurance on December 31, 2022. The company paid in full for their insurance for three years on April 1, 2022. What would be the correct entry the company would make for the year-end?

4. The office supplies account had a $5000 debit balance on January 1, 2022. During the year the company purchased $3,000 more supplies. The December 31, 2022, physical count showed $1,500 of supplies still on hand. What would be the correct entry the company would make for the year-end?

5. Sullivan Co. receives $40,000 cash in advance for 8 months of legal services on October 31, 2022. What would be the correct entry the company would make for the year-end?

6. Accrue for service revenue earned $ 20,000.

7. Bad debt are recorded at 3% of sales. Service revenue on credit was $10,000.

8. XYX has employees who are paid in total $30,000 each week on Friday (Assume a five-day work week). You are to complete the adjusting entry on June 30 which is a Wednesday.

9. On June 1 of the current year, Williams Company rented to another company some excess space in one of its buildings. Williams Company received $50,000 cash on June 1. The rental period extends for twelve months, starting on June 1. Williams Company credited the Unearned Rent revenue account upon receipt of the rent paid in advance. Make the appropriate adjusting entry on December 31.