DATE DESCRIPTION PR DEBIT CREDIT

Dec 31 1. Prepaid Insurance 1,500

. Insurance expense 1,500
36,000 / 24
2. Rent revenue 2,000
Prepaid rent 2,000
18,000 / 9
3. Depreciation expense- Equipment 1,729
Accumulated expense- Equipment 1,729
52,000 x 25% x 1/12 = 1,083
372,000 x 25% x 1/12 x 1/12 = 646
4. Account receivable 48,000
Uncollected income 48,000
5. Office supplies 4,000
Supplies expense 4,000
9,000-5000
6. Unearned revenue 32,000
Revenue receivable 32,000
80,000 x 40%
7. Interest expense 2,700
Interest payable 2,700
120,000 x 9% x 3/12
8. Unearned service revenue 240,000
Service revenue 240,000
400,000 x 60%
9. Interest receivable 3,000
Interest revenue 3,000
100,000 x 12% x 3/12
10.

Exercise 4-7
 DATE DESCRIPTIONS PR DEBIT CREDIT

Dec. 31 A. interest expense 2,333

Interest payable 2,333
200,000 x 14% x 1/12

B. Prepaid insurance 77,500

Insurance expense 77,500
(90,000 / 36) x 31
C. Rent expense 5,000
Prepaid rent 5,000
60,000 / 12

D. Supplies expense 1,300

Office supplies 1,300
3,100-1800
E. Salaries expense 40,000
Salaries payable 40,000
To take up unpaid expenses

F. Depreciation expense – Equipment 376.39

Accumulated expense – Equipment 376.39
45,000 x 1/120 = 375
20,000 x 1/120 x 1/120 = 1.39
G. Doubtful accounts expense 300
Allowance for doubtful accounts 300
1,000 x 3%
Problem 4-1
 DATE DESCRIPTION PR DEBIT CREDIT

Dec 31 A. Unearned revenue 9,500

.
Revenue Receivable 9,500
To take up revenue
B. Rent revenue 5,300
Unearned revenue 5,300
6,800-1,500
c. Prepaid insurance 4,000
insurance expense 4,000
6,000-2,000
d. Revenue receivable 4,800
Subscription revenue 4,800
9,800-5,000
e. Interest receivable 2,400
interest revenue 2,400
to take up uncollected income
f. Interest expense 4,600
interest payable 4,600
to take up unpaid expenses
g. interest expense 327
prepaid expense 327
980 / 3
h.
I. Supplies expense 4,325
Store supplies 4,325
6,600-2,250
j. Account receivable

k. Depreciation expense – Building 1,042

Accumulated expense – Building 1,042
(300,000 – 50,000) / 240
Problem 4-2