$ 1,200
1,900
$ 1,100
9,750
$ 2,100
1. $ 79,350
—
2. $ 13,500
—
3. $114,000
Cash paid for salaries during the year:
Unearned fees at end of 2014
Prepaid insurance at end of 2014
Insurance expense during 2014
Wages payable at end of 2013
Wages expense during 2014
E11A. Determination of Cash Flows
Instructor’s Resource CD and website.
Note to Instructor: Solutions for Exercises: Set B are provided separately on the
E12A. Relationship of Expenses to Cash Paid
Less beginning balance
Cash paid for rent during the year:
Less ending balance
Cash paid for interest during the year:
3-9
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Balance Balance
after after
Adjustment Adjustment
Amount of
Rent Expense
(+ or –)
Adjustment
Statement Account
Depreciation Expense—
Answering Service Revenue
Office Supplies Expense
Income
(+ or –)
Amount of
Equipment
Wages Expense
Adjustment
3-10
a. 30 5,171
=
b. 30 6,874
c. 30 16,000
40,000
d. 30 3,100
e. 30 7,000
f. 30 18,000
g. 30 10,000
h.
2. In transaction “e,” $7,000 has to be recognized as revenue because services have
No entry
To record accrued wages
Wages Expense
1.
P2. Preparing Adjusting Entries
Nov.
$5,171
Depreciation Expense—Buildings
a contract to be billed in January
To record service revenue earned on
To record supplies used
Insurance Expense
Accounts Receivable
Depreciation Expense—Equipment
Supplies Expense
Unearned Services Revenue
To record annual depreciation
Interest Expense
To record accrued interest on note payable
3-11
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Bal. 12,786 Bal. 991 (a) 905
Bal. 1,400 (b) 700 Bal. 6,700
Bal. 1,820 Bal. 10,000 (f) 1,450 Bal. 2,860
(d) 600 (e) 200 Bal. 29,387
Bal. 1,750 Bal. 7,700 (a) 905
P3. Determining Adjusting Entries, Posting to T Accounts, and Preparing an Adjusted Trial
Balance
1. and 2.
Cash Accounts Receivable
Interest Payable Salaries Payable
Notes Payable
Unearned Service Revenue
Rent Expense Office Supplies Expense
Salaries Expense
K. Wah, Withdrawals
Accounts Payable
Utilities Expense
Service Revenue
Office Equipment
1,600 Bal.
Office Equipment
Accumulated Depreciation—
Bal. 24,840
K. Wah, Capital
Office Supplies
Prepaid Rent
3-12
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3.
12,786
25,440
4. a.
b.
Balance sheet, income statement, statement of owner’s equity
Balance sheet, income statement, statement of owner’s equity
December 31, 2014
P3. Determining Adjusting Entries, Posting to T Accounts, and Preparing an Adjusted Trial
Balance (Concluded)
Kinokawa Consultants Company
Adjusted Trial Balance
Cash
Accounts Receivable
3-13
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Page 14
Post.
Ref. Debit Credit
30 514 12,000
30 515 2,800
30 518 10,944
30 516 9,408
30 517 25,000
30 519 1,500
30 212 12,185
P4. Determining Adjusting Entries and Tracing Their Effects to Financial Statements
2014
Depreciation Expense—Limousines
To record amount of deposit
used during the year
Spare Parts Expense
1.
General Journal
Date Description
in advance
To record insurance that expired
during the year
June
Unearned Passenger Service Revenue
Interest Expense
To record accrued interest
Maintenance Expense
Rent Expense
To expense second year’s rent paid
Insurance Expense
3-14
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Ref. Debit Credit Debit Credit
Ref. Debit Credit Debit Credit
Ref. Debit Credit Debit Credit
Ref. Debit Credit Debit Credit
Ref. Debit Credit Debit Credit
Ref. Debit Credit Debit Credit
Spare Parts Account No. 140
2014
Date Item
Post. Balance
P4. Determining Adjusting Entries and Tracing Their Effects to Financial Statements
(Continued)
Prepaid Insurance
Account No. 118
Date
2014
Item
Balance
Post.
Item
Account No. 119
Balance
2014
Prepaid Maintenance
Date
Post.
2014
Post.
Account No. 111
Balance
Date
Accounts Receivable
Date
Balance
Item
Account No. 113
Post.
Item
Cash
2014
Account No. 117Prepaid Rent
Date Item
2014
Post.
2. and 3.
Balance
3-15
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Ref. Debit Credit Debit Credit
Ref. Debit Credit Debit Credit
Ref. Debit Credit Debit Credit
Ref. Debit Credit Debit Credit
Ref. Debit Credit Debit Credit
Ref. Debit Credit Debit Credit
Post.
2014
ItemDate
Account No. 311
Balance
A. Phylum, Capital
Item
Balance
Date
Post.
2014
2014
Accumulated Depreciation—Limousines
Post.
Item
Post.
Balance
Item
Post. Balance
Item
2014
Interest Payable
Date
Account No. 213
2014
Unearned Passenger Service Revenue
Post.
Account No. 212
Date
Balance
Balance
Account No. 211
Account No. 149
Notes Payable
Date
2014
Date Item
P4. Determining Adjusting Entries and Tracing Their Effects to Financial Statements
(Continued)
Limousines Account No. 148
3-16
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