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d.
2,930$
PROBLEM 4.7
A
KEN HENSLEY ENTERPRISES, INC. (concluded)
December 31, 2015
Insurance expense of $250 per month in the last 5 months of the year was $10 per month
more than the average monthly cost in the first 7 months of the year ($250 - $240).
Insurance expense for 12 months ended
20 Minutes, Strong
a. NE O U NE NE NE
PROBLEM 4.8
A
COYNE CORPORATION
Error Total
Revenue Total
Expenses Net
Income Total
Assets Total
Liabilities Owners’
Equity
Recorded a dividend as
an expense reported in
the income statement.
20 Minutes, Easy
Dec. 31 13
,
600
Salaries Pa
y
able 13
,
600
31
To record income taxes accrued in December.
when it is earned. Enterin
g
into a contract does not
To record December insurance ex
p
ense
(
7
)
constitute the earnin
g
of revenue.
No ad
j
ustin
g
entr
y
re
q
uired. Revenue is reco
g
nized
(
$10,800 x 1/12
)
.
SOLUTIONS TO PROBLEMS SET B
a.
(Adjusting Entries)
(1)
To record accrued salaries at December 31.
PROBLEM 4.1B
GEORGIA GUN CLUB
20__
(
$60,000 x 8% x 1/12
)
.
Salaries Ex
p
ense
To record accrued interest ex
p
ense in December
b. 1.
2.
c.
Accruing unpaid expenses.
Accruing uncollected revenue.
PROBLEM 4.1B
GEORGIA GUN CLUB (concluded)
The clubhouse was built in 1956 and has been fully depreciated for financial accounting
40 Minutes, Medium
a.
Dec. 31 425
Interest Revenue 425
31
Interest Receivable
To record accrued interest revenue.
PROBLEM 4.2B
(
Ad
j
ustin
g
Entries
)
(
1
)
General Journal
BIG OAKS
To record December de
p
reciation ex
p
ense
(
4
)
(
$720,000 ÷ 20
y
ears x 1/12
)
.
To record income taxes accrued in December.
No ad
j
ustin
g
entr
y
re
q
uired. Revenue is reco
g
nized
when it is earned. Enterin
g
into a contract does not
constitute the earnin
g
of revenue.
(
$45
p
er da
y
x 18 da
y
s
)
.
To record accrued bus rental ex
p
ense in December
To record accrued salar
y
ex
p
ense in December.
b. 1.
2.
BIG OAKS (concluded)
PROBLEM 4.2B
Accruing uncollected revenue.
Accruing unpaid expenses.
25 Minutes, Strong
a. (1)
PROBLEM 4.3B
RIVER RAT
Age of the ferry in months = accumulated depreciation/monthly depreciation.
Useful life is given as 12 years, or 144 months.
To record expiration of insurance in April.
To record April depreciation expense on ferr
y
.
To record earnin
g
of revenue from 150 ride
(
3
)
tickets used in April
(
150 tickets x $5 = $750
)
.
30 Minutes, Medium
OFF-CAMPUS PLAYHOUSE
PROBLEM 4.4B
months
)
.
a.
(Adjusting Entries)
General Journal
To record September depreciation
(
$18,000 ÷ 60
b.
c.
Nine months (bills received January through September). Utility bills are recorded as
PROBLEM 4.4B
OFF-CAMPUS PLAYHOUSE (concluded)
Corporations must pay income taxes in several installments throughout the year. The
balance in the Income Taxes Expense account represents the total amount of income taxes
expense recognized since the beginning of the year. But Income Taxes Payable represents
only the portion of this expense that has not yet been paid.
(1)
30 Minutes, Medium
Dec. 31 3,200
Lesson Revenue Earned 3,200
PROBLEM 4.5B
MARVELOUS MUSIC
Accounts Receivable
To record accrued but uncollected revenue.
2015
a.
(Adjusting Entries)
(1)
General Journal
