ACC 1100 Chapter 3B Adjusting Entry Columbia Question D2L PDF

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Adjusting Entry Columbia...

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ACC 1100 Introductory Financial Accounting Chapter 3. Adjusting Entry Columbia Flying Service Unadjusted Trial Balance As at December 31, 2017 Cash Accounts receivable Supplies inventory Parts inventory Equipment Equipment, accumulated depreciation Planes Planes, accumulated depreciation Prepaid insurance Accounts payable Unearned revenue Notes payable Common shares Retained earnings Revenues from lessons Revenues from charters Salaries Fuel expense Maintenance expense Supplies expense Insurance expense Advertising expense Rent expense Interest expense Licences and fees

Debit $37,500 45,000 2,000 24,000 42,000

Credit

$6,000 216,000 71,000 15,000 8,000 28,000 60,000 10,000 78,100 895,000 156,000 623,000 189,000 51,000 6,000 34,000 13,000 11,000 2,400 1,200 $1,312,100

$1,312,100

The following information is also available: 1) Instructor salaries for the last week of December, 2017, have not yet been recorded. They will be payable the first week of the New Year. Salaries for the one week are $15,500. 2) In the course of the last two weeks of December, 2017, lessons were given that had been paid for in advance. The amount charged for the lessons was $16,500. No accounting recognition has yet been given for the service provided. 3) No depreciation has been recorded in 2017. The useful life of the planes is estimated at 10 years (no salvage value) and that of the equipment at 7 years (also no salvage value). 4) Rent for December, $1,000, has not yet been paid and recorded. 5) The company purchases a one-year insurance policy each year which takes effect on July 1. The entire cost of the current year’s policy has been charged to “Insurance expense”. The December 31, 2017, balance in “Prepaid insurance” was the same as that on January 1, 2017. No entries to the account have been made during the year. 6) Interest on the $60,000 note payable outstanding is payable twice each year, April 1 and October 1. The annual rate of interest is 8 percent. The note was issued on April 1, 2017; the amount of interest expense represents the first interest payment, which was made on October 1. 7) A physical count of parts on hand indicated an unexplained shortage of parts that had cost $2,000. An adjustment to parts inventory has not yet been made. 8) All purchases of supplies are charged (debited) to “Supplies expense.” The balance in “Supplies inventory” represents supplies on hand at the beginning of the year. A physical count on December 31, 2017, indicated supplies currently on hand of $4,000. 9) On December 30, the company flew a charter for which it has not yet billed the customer and which it has not yet recorded in the accounts. The customer will be charged $6,800. 10) Based on preliminary computations, the firm estimates that income tax expense for current year will be $22,000. Required a. b.

Prepare all journal entries that would be necessary to adjust and bring the accounts up to date. (Add any additional account titles that you believe to be necessary.) Prepare all the financial statements except the statement of cash flows for the year ending December 31, 2017....