The following information for CLH Company is available on June 30, 2018, the end of a monthly

accounting period. You are to prepare the necessary adjusting journal entries for CLH Company for the
month of January for each situation given. Aporopriate adjusting entries had been recorded in previous
months. You may omit journal entry explanations.
1. Lance Company purchased a 3-year insurance policy on March 1, 2018, and debited Prepaid Insurance
for $7.200.
2. On January 1, 2018, a tenant in an apartment building owned by CLH Company paid 55,400, which
represents six months' rent in advance. The amount received was credited to the Unearned Rent account.
3. On June 1, 2018, the balance in the Office Supplies account was $100. During June, office supplies
costing 5600 were purchased. A physical count of office supplies at June 30 revealed that there was $250
still on hand.
4. On March 31, 2018, CLH Company purchased a delivery van for $42,000. It is estimated that the
annual depreciation will be $8,400.
5. TL&MA Company has two office employees who earn $80 and 590 per day, respectively. They are paid
each Friday for a five-day workweek that begins cach Monday, June 30 is a Thursday in 2016.

For each situation given below prepare journal entries on the October for BC Company B us perpetual
inventory system.
Oct. 5 Paid $15,000 cash for operating expenses that were incurred and properly recorded in the previous
period.
8 Purchased merchandise for $12,000 on account. Credit terms: 2/10, n/30.
10 Paid freight bill of $200 for merchandise purchased on October 8.
15 Paid for merchandise purchased on October 8. The company takes all discounts to which it is entitled
20 Sold merchandise for $16,000 to TL on account. The cost of the merchandise sold was $9,500. Credit
terms: 2/10, n/30.
25 Issued a credit memo to TL for $1,000 for merchandise returned by him from the sale on October 20.
The cost of the merchandise returned was $600.
 Operating expenses 15000
Oct 5 cash 15000
Oct 8 Inventory 120000
Account payable 12000
Oct 10 Inventory 200
cash 200
Oct15 Account payable 12000
Cash 11760
Inventory 240
Oct 20 Account reveiable 16000
Sales revenue 16000
Cost of goods sold 9500
Inventory 9500
Oct 25 Sales return and 1000
allowances
Account receiable 1000
Inventory 600
Cost of goods sold 600

Sales Revenue

Sales 400.000

Less: sales discount 20.000

Net sales 380.000

Cost of good sold 260.000

Gross profit 120.000

Operating expense

Selling expense 36.000

Admin expense 17.000

Total operating expense 53.000

Income from operation

Other revenues and gains 67.000

Interest revenue 900

Other expenses and losses

Interest expense 2.500 (1600)

65.400

1, Ending units = 350, total units = 800, total cost = 9600

Arg cost = Ending inventory = 9600/800 x 350 = 4200

COGS = 5400

2, FIFO = ending inventory = 250 x 16 + 100 x 12 = 5200

-->COGS = 4400
Jul 1 Notes receiable 10.000
Account Receiable 10.000
Jul 31 Interest receiable 67
Interest revenue ( 10.000 x 8% x 67
1/12)

OCT 1 CASH 10200

Notes receiable 10000
Interest revenue (notes honored) 200
(10000x8%x3/12)
Oct 1 Bad debt expense 10.000
Allowance for doubtful account 10000
(eventually pay the amountowed)

March 1 Less on disposal 4.000

Accumulated dep-store equipment 16.000
Store equipment 20.000
Jul 31 Cash 8.000
Accumulated dep-truck 24.000
Delivery truck 30.000
Gain on disposal 2.000
Sep 30 Depreciation expense 3333
Accumulated dep – equipment 3333
(16.000x1/4x10/12)
Cash 5.000
Accumulated dep-equipment 19.333
(16.000/4)x4 + 3333
Equipment 16.000
Gain on disposal 8.333
assets Acc.dep Dep.expense for 2016 Book value at 12/31/2016
1/1/16
Delivery truck 12.500 13.500 (1) 24.000(2)
((50.000-5.000)/100.000)x30.000
building 8.066.000 218.000(3) 516.000(4)
Store 36.000 21.600(5) 32.400
equipment
(1) : ((50.000-5.000)/100.000) x 30.000
(2) : 50.000-12.500-13.500
(3) : (8.800.000-80.000):40
(4) : 8.800.000-8.066.000-218.000
(5) : (90.000-36.000)x40%
(6) : 90.000-36.000-21.600
(double decling: 200% in 5 years  40% each).