Accounting Principles (13th edition)

Chapter-03: Adjusting the Accounts

Exercise list: E3.5, E3.7, E3.13, P3.1A, P3.2A, P3.5A

E3.5
Devin Wolf Company has the following balances in selected accounts on December 31, 2020.
Particulars Amounts($)
Accounts Receivable 0
Accumulated Depreciation-Equipment 0
Equipment 7,000
Interest Payable 0
Notes payable 10,000
Prepaid Insurance 2,100
Salaries and wages payable 0
Supplies 2,450
Unearned Service Revenue 32,000
All the accounts have normal balances. The information below has been gathered at December
31,2020.
1. Devin Wolf Company borrowed $10,000 by signing a 9%, one-year note on September 1,
2020.
2. A count of supplies on December 31, 2020, indicates that supplies of $900 are on hand.
3. Depreciation on the equipment for 2020 is $1,000.
4. Devin Wolf Company paid $2,100 for 12 months of insurance coverage on June 1,2020.
5. On December 1,2020, Devin Wolf Company collected $32,000 for consulting services to
be performed from December 1, 2020, through March 31, 2021.
6. Devin Wolf Company performed consulting services for a client in December 2020. The
client will be billed $4,200.
7. Devin pays its employees total salaries of $9,000 every Monday for the preceding 5-day
week (Monday through Friday). On Monday, December 29, employees were paid for the
week ending December 26. All employees worked the last 3 days of 2020.
Instructions: Prepare annual adjusting entries for the seven items described above.

Solution:
 Devin Wolf Company
Adjusting Journal
For the year ended December 31,2020
Date Accounts Title Ref. Debit ($) Credit ($)
2020 Interest expense 300
Dec-31 Interest payable 300
(10,000×9%×4/12)
- Supplies expense 1,550
31 Supplies 1,550
(2450-900)
-31 Depreciation expense 1,000
Accumulated depreciation-Equipment 1,000
-31 Insurance expense 1,225 1,225
Prepaid Insurance
(2,100×7/12)
-31 Unearned consulting revenues 1,050
Consulting revenues 1,050
(32,000/4)
-31 Accounts Receivable 4,200
Consulting revenues 4,200
-31 Salaries expense 5,400
Salaries payable 5,400
(9,000×3/5)

E3.7
The ledger of Passehl Rental Agency on March 31 of the current year includes the selected
accounts, shown below, before adjusting entries have been prepared.
Particulars Debit ($) Credit ($)
Prepaid insurance 3,600
Supplies 2,800
Equipment 25,000
Accumulated Depreciation-Equipment 8,400
Notes Payable 20,000
Unearned Rent Revenue 10,200
Rent Revenue 60,000
Interest Expense 0
Salaries and Wages Expense 14,000

An analysis of the accounts shows the following:

1. The equipment depreciate $400 per month.
2. One-third of the unearned rent revenue was earned during the quarter.
3. Interest of $500 is accrued on the notes payable.
4. Supplies on hand total $750.
 5. Insurance expires at the rate of $300 per month.
Instructions: Prepare the adjusting entries at March 31, assuming that adjusting entries are made
quarterly. Additional accounts are Depreciation Expense, Insurance Expense, Interest Payable,
and Supplies Expense.
Solution:
Passehl Rental Agency
Adjusting Journal
For the quarter ended March 31,2020
Date Accounts Title Ref. Debit ($) Credit ($)
2020 Depreciation expense 1,200
Mar-31 Accumulated depreciation-Equipment 1,200
[400×3=1,200]
-31 Unearned Rent Revenue 3,400
Rent Revenue 3,400
(10,200/3)
-31 Interest expense 500
Interest payable 500
-31 Supplies expense 2,050
Supplies 2,050
(2800-750)
-31 Insurance expense 900
Prepaid Insurance 900
(300×3=900)

E3.13
The ledger of Armour Lake Lumber Supply on July 31, 2020, includes the selected accounts
below before adjusting entries have been prepared.
Particulars Debit ($) Credit ($)
Notes Payable 20,000
Supplies 24,000
Prepaid Rent 3,600
Buildings 2,50,000
Accumulated Depreciation-Buildings 1,40,000
Unearned Service Revenue 11,500

An analysis of the accounts shows the following:

1. The notes payable pays interest at a rate of 6% per year.
2. Supplies on hand at the end of the month totaled $18,600.
3. The balance in prepaid rent represents 4 months of rent costs.
4. Employees were owed $3,100 related to unpaid salaries and wages.
5. Depreciation on buildings is $6,000 per year.
 6. During the month, the company satisfied obligations worth $4,700 related to the unearned
service revenue.
7. Unpaid maintenance and repairs costs were $2,300.
Instructions: Prepare the adjusting entries at July 31 assuming that adjusting entries are made
monthly. Use additional accounts as needed.
Solution:

Armour Lake Lumber Supply

Adjusting Journal
For the Month ended July 31,2020
Date Accounts Title Ref. Debit ($) Credit ($)
2020 Interest expense 100
July-31 Interest payable 100
[20,000×6%1/12]
-31 Supplies expense 15,400
Supplies 15,400
(24,000-8600)
-31 Rent Expenses 900
Prepaid Rent 900
[3,600/4]
-31 Salaries and Wages expenses 3,100
Salaries and Wages Payable 3,100
-31 Depreciation expense 500
Accumulated depreciation-Equipment 500
[6,000/12]
-31 Unearned Service Revenue 4,700
Service Revenue 4,700
-31 Maintenance and Repair expense 2,300
Maintenance and Repair Payable 2,300
Problems
P3.1A
Logan Krause started her own consulting firm, Krause Consulting, on May 1, 2020. The trial
balance at May 31 is as follows.
Krause Consulting
Trial Balance
May 31, 2020
Account Account Title Debit ($) Credit ($)
Number
101 Cash 4,500
112 Accounts Receivable 6,000
126 Supplies 1,900
130 Prepaid Insurance 3,600
149 Equipment 11,400
201 Accounts payable 4,500
209 Unearned Service Revenue 2,000
301 Owner’s capital 18,700
400 Service revenue 9,500
726 Salaries and Wages expense 6,400
729 Rent Expense 900
Total $34,700 $34,700

In addition to those accounts listed on the trial balance, the chart of accounts for Krause
Consulting also contains the following accounts and account numbers: No. 150 Accumulated
Depreciation-Equipment, No.212 Salaries and wages Payable, No 631Supplies Expense, No.717
Depreciation Expense, No. 722 Insurance Expense, and No. 732 Utilities Expense.
Other data:
1. $900 of supplies have been used during the month.
2. Utilities expense incurred but not paid on May 31, 2020, $250
3. The insurance policy is for 2 years.
4. $400 of the balance in the unearned service revenue account remains unearned at the end
of the month.
5. May 31 is a Wednesday, and employees are paid on Fridays. Krause Consulting has two
employees, who are paid $920 each for a 5-day work week.
6. The equipment has a 5-year life with no residual value. It is being depreciated at $190 per
month for 60 months.
7. Invoices representing $1,700 of services performed during the month have not been
recorded as of May 31.
Instructions:
 a) Prepare the adjusting entries for the month of May. Use J4 as the page number for your
journal.
b) Post the adjusting entries to the ledger accounts. Enter the totals from the trail balance as
beginning account balances and place a check mark in the posting reference column.
c) Prepare an adjusted trial balance at May 31, 2020.

Solution:
Req.a)
Krause Consulting
Adjusting Entries
For the month of May 31, 2020
Date Accounts Title Ref. Debit (€) Credit (€)
2020 Supplies Expense 900
May-31 Supplies 900
(To record supplies used.)
-31 Utilities Expense 250
Utilities Payable 250
(To record utility expense)
-31 Insurance Expense (3600/24) 150
Prepaid Insurance 150
(To record insurance expired)
-31 Unearned Service Revenue (2000-400) 1,600
Service Revenue 1,600
(Unearned service revenue has been earned)
-31 Salaries and Wages expenses [(920÷5)×3×2] 1,104
Salaries and Wages Payable 1,104
(To record accrued salaries and wages expense)
-31 Depreciation expense {(11,400÷5)÷12} 190
Accumulated depreciation-Equipment 190
(To record depreciation)
-31 Accounts Receivable 1,700
Service Revenue 1,700
(To record service performed but unbilled.)
Req.b)
Krause Consulting
(General Ledger)
Cash
No.101
Date Explanation Ref. Debit Credit Balance
2020
May-31 Balance b/d 4,500 4,500

Accounts Receivable
No.112
Date Explanation Ref. Debit Credit Balance
2020
May-31 Balance b/d 6,000 6,000
May-31 Service Revenue J4 1,700 7,700

Prepaid Insurance
No.130
Date Explanation Ref. Debit Credit Balance
2020
May-31 Balance b/d 3,600 3,600
May-31 Insurance Expense 150 3,450

Supplies
No.126
Date Explanation Ref. Debit Credit Balance
2020
May-31 Balance b/d 1,900 1,900
May-31 Supplies expense 900 1,000

Equipment
No.149
Date Explanation Ref. Debit Credit Balance
2020
May-31 Balance b/d 11,400 11,400

Accumulated Depreciation- Equipment

No.150
Date Explanation Ref. Debit Credit Balance
2020
May-31 Depreciation Expense 190 190

Accounts Payable
No.201
Date Explanation Ref. Debit Credit Balance
2020
May-31 Balance b/d 4,500 4,500
 Utilities Payable
No.210
Date Explanation Ref. Debit Credit Balance
2020
May-31 Balance b/d 250 250

Salaries and Wages Payable

No.220
Date Explanation Ref. Debit Credit Balance
2020
May-31 Salaries and Wages Expense 1,104 1,104

Unearned Service Revenue

No.209
Date Explanation Ref. Debit Credit Balance
2020
May-31 Balance b/d 2,000 2,000
May-31 Service Revenue 1,600 400

Owner’s Capital
No.301
Date Explanation Ref. Debit Credit Balance
2020
May-31 Balance b/d 18,700 18,700

Service Revenue
No.400
Date Explanation Ref. Debit Credit Balance
2020
May-31 Balance b/d 9,500 9,500
May-31 Unearned Service Revenue 1,600 11,100
May-31 Accounts Receivable 1,700 12,800

Salaries and Wages Expense

No.726
Date Explanation Ref. Debit Credit Balance
2020
May-31 Balance b/d 6,400 6,400
May-31 Salaries and Wages payable 1,104 7,504

Depreciation Expense- Depreciation

No.539
Date Explanation Ref. Debit Credit Balance
2020
May-31 Accumulated Depreciation- office Furniture 190 190

Rent Expense
No.729
Date Explanation Ref. Debit Credit Balance
2020
May-31 Balance b/d 900 900
 Insurance Expense
No.540
Date Explanation Ref. Debit Credit Balance
2020
May-31 Prepaid Insurance 150 150

Utilities Expense
No.550
Date Explanation Ref. Debit Credit Balance
2020
May-31 Utilities expense 250 250

Supplies Expense
No.560
Date Explanation Ref. Debit Credit Balance
2020
May-31 Supplies 900 900

Req.c)

Krause Consulting
Trial Balance
May 31, 2020
Account Account Title Debit ($) Credit ($)
Number
101 Cash 4,500
112 Accounts Receivable 7,700
126 Supplies 1,000
130 Prepaid Insurance 3,450
149 Equipment 11,400
150 Accumulated Depreciation-Building 190
201 Accounts payable 4,500
210 Utilities Payable 250
220 Salaries and Wages Payable 1,104
209 Unearned Service Revenue 400
301 Owner’s capital 18,700
400 Service revenue 12,800
726 Salaries and Wages expense 7,504
539 Depreciation Expense-Equipment 190
729 Rent Expense 900
540 Insurance Expense 150
550 Utilities Expense 250
560 Supplies Expense 900
Total $37,944 $37,944
P3.2A

Hank’s Hotel opened for business on May 1, 2020. Its trial balance before adjustment on May 31
is as follows.
Hank’s Hotel
Trial Balance
May 31, 2020
Account Number Accounts Title Debit Credit
101 Cash 3,400
126 Supplies 2,080
130 Prepaid Insurance 2,400
140 Land 12,000
141 Buildings 60,000
149 Equipment 15,000
201 Accounts Payable 4,700
208 Unearned Service Revenue 3,300
275 Mortgage Payable 40,000
301 Owner’s Capital 41,380
429 Rent Revenue 10,300
610 Advertising Expense 600
726 Salaries and Wages Expense 3,300
732 Utilities Expense 900
Total 99,680 99,680

In addition to those accounts listed on the trial balance, the chart of accounts for Hank’s Hotel
also contains the following accounts and account numbers: No. 142 Accumulated
Depreciation—Buildings, No. 150 Accumulated Depreciation—Equipment, No. 212 Salaries and
Wages Payable, No. 230 Interest Payable, No. 619 Depreciation Expense, No. 631 Supplies
Expense, No. 718 Interest Expense, and No. 722 Insurance Expense.

Other data:
1. Prepaid insurance is a 1-year policy starting May 1, 2020.
2. A count of supplies shows $750 of unused supplies on May 31.
3. Annual depreciation is $3,600 on the buildings and $1,500 on equipment.
4. The mortgage interest rate is 6%. (The mortgage was taken out on May 1.)
5. Two-thirds of the unearned rent revenue has been earned.
6. Salaries of $750 are accrued and unpaid at May 31.

Instructions
a. Journalize the adjusting entries on May 31.
b. Prepare a ledger using the three-column form of account. Enter the trial balance amounts and
post the adjusting entries. (Use J1 as the posting reference.)
c. Prepare an adjusted trial balance on May 31.
d. Prepare an income statement and an owner’s equity statement for the month of May and a
balance sheet at May 31.
Solution:
Req.a)
Hank’s Hotel
Adjusting Entries
For the month of May 31, 2020
Date Accounts Title Ref. Debit (€) Credit (€)
2020 Insurance Expense 200
May-31 Prepaid Insurance 200
(To record prepaid expense expired for one month.)
-31 Supplies Expense [2080-750] 1,330
Supplies 1,330
(To record supplies used.)
-31 Depreciation expense [3,600÷12] 300
Accumulated depreciation-Building 300
(To record depreciation)
Depreciation expense [1,500÷12] 125
Accumulated depreciation-Equipment 125
(To record depreciation)
-31 Interest Expense [40,000×6%]÷12 200
Interest Payable 200
(To record utility expense)
-31 Unearned Rent Revenue (3,300÷3)×2 2,200
Rent Revenue 2,200
(Unearned service revenue has been earned)
-31 Salaries and Wages expenses 750
Salaries and Wages Payable 750
(To record accrued salaries and wages expense)

Req.b)

Hank’s Hotel
(General Ledger)
Cash
No.101
Date Explanation Ref. Debit Credit Balance
2020
May-31 Balance b/d 3,400 3,400

Land
No.140
Date Explanation Ref. Debit Credit Balance
2020
May-31 Balance b/d 12,000 12,000
 Prepaid Insurance
No.130
Date Explanation Ref. Debit Credit Balance
2020
May-31 Balance b/d 2,400 2,400
May-31 Insurance Expense 200 2,200

Supplies
No.126
Date Explanation Ref. Debit Credit Balance
2020
May-31 Balance b/d 2,080 2,080
May-31 Supplies expense 1,330 750

Buildings
No.141
Date Explanation Ref. Debit Credit Balance
2020
May-31 Balance b/d 60,000 60,000

Equipment
No.149
Date Explanation Ref. Debit Credit Balance
2020
May-31 Balance b/d 15,000 15,000

Accumulated Depreciation- Buildings

No.142
Date Explanation Ref. Debit Credit Balance
2020
May-31 Depreciation Expense 300 300

Accumulated Depreciation- Equipment

No.150
Date Explanation Ref. Debit Credit Balance
2020
May-31 Depreciation Expense 125 125

Accounts Payable
No.201
Date Explanation Ref. Debit Credit Balance
2020
May-31 Balance b/d 4,700 4,700

Mortgage Payable
No.275
Date Explanation Ref. Debit Credit Balance
2020
May-31 Balance b/d 40,000 40,000
 Salaries and Wages Payable
No.212
Date Explanation Ref. Debit Credit Balance
2020
May-31 Salaries and Wages Expense 750 750

Unearned Rent Revenue

No.208
Date Explanation Ref. Debit Credit Balance
2020
May-31 Balance b/d 3,300 3,300
May-31 Rent Revenue 2,200 1,100

Owner’s Capital
No.301
Date Explanation Ref. Debit Credit Balance
2020
May-31 Balance b/d 41,380 41,380

Rent Revenue
No.429
Date Explanation Ref. Debit Credit Balance
2020
May-31 Balance b/d 10,300 10,300
May-31 Unearned Service Revenue 2,200 12,500

Salaries and Wages Expense

No.726
Date Explanation Ref. Debit Credit Balance
2020
May-31 Balance b/d 3,300 3,300
May-31 Salaries and Wages payable 750 4,050

Depreciation Expense- Depreciation

No.619
Date Explanation Ref. Debit Credit Balance
2020
May-31 Accumulated Depreciation- Buildings 300 300
May-31 Accumulated Depreciation- Equipment 125 425

Advertising Expense
No.610
Date Explanation Ref. Debit Credit Balance
2020
May-31 Balance b/d 600 600

Insurance Expense
No.722
Date Explanation Ref. Debit Credit Balance
2020
May-31 Prepaid Insurance 200 200
 Utilities Expense
No.732
Date Explanation Ref. Debit Credit Balance
2020
May-31 Balance b/d 900 900

Supplies Expense
No.631
Date Explanation Ref. Debit Credit Balance
2020
May-31 Supplies 1,330 1,330

Interest Expense
No.718
Date Explanation Ref. Debit Credit Balance
2020
May-31 Balance b/d 200 200

Interest Payable
No.230
Date Explanation Ref. Debit Credit Balance
2020
May-31 Interest Expense 200 200

Req.c)
Hank’s Hotel
Trial Balance
May 31, 2020
Account Number Account Title Debit ($) Credit ($)
101 Cash 3,400
126 Supplies 750
130 Prepaid Insurance 2,200
140 Land 12,000
141 Buildings 60,000
149 Equipment 15,000
201 Accounts Payable 4,700
208 Unearned Service Revenue 1,100
275 Mortgage Payable 40,000
301 Owner’s Capital 41,380
429 Rent Revenue 12,500
610 Advertising Expense 600
726 Salaries and Wages Expense 4,050
732 Utilities Expense 900
142 Accumulated Depreciation-Buildings 300
150 Accumulated Depreciation-Equipment 125
212 Salaries and Wages Payable 750
 619 Depreciation Expense 425
722 Insurance Expense 200
631 Supplies Expense 1,330
718 Interest Expense 200
230 Interest Payable 200
Total 1,01,055 1,01,055

Req.d)

Hank’s Hotel
Income Statement
For the month ended 31st May,2020
Amount Amount
Revenues:
Rent Revenue 12,500
Expenses:
Advertising Expense 600
Salaries and Wages Expense 4,050
Utilities Expense 900
Depreciation Expense [300+125] 425
Insurance Expense 200
Supplies Expense 1,330
Interest Expense 200
Total expenses (7,705)
Net Income 4,795

Hank’s Hotel
Income Statement
For the month ended 31st May,2020
Amount Amount
Owner’s Capital, May 1 41,380
Add: Net Income 4,795
Owner’s Capital, May 31 46,175

Hank’s Hotel
 Income Statement
31st May,2020
Amount Amount
Assets:
Cash 3,400
Supplies 750
Prepaid Insurance 2,200
Land 12,000
Buildings 60,000
Less: Accumulated Depreciation-Buildings 300 59,700
Equipment 15,000
Less: Accumulated Depreciation-Equipment 125 14,875
Total assets 92,925
Liabilities and Owner’s Capital:
Liabilities:
Accounts Payable 4,700
Unearned Service Revenue 1,100
Mortgage Payable 40,000
Salaries and Wages Payable 750
Interest Payable 200
Total Liabilities 46,750
Owner’s Capital:
Owner’s Capital May 31 46,175
Total Liabilities and Owner’s Capital 92,925

P3.5A
On November 1, 2020, the account balances of Hamm Equipment Repair were as follows.
No. Debit No. Credit
101 Cash $2,400 154 Accumulated Dep.-Equip. $2,000
112 Accounts Receivable 4,250 201 Accounts Payable 2,600
126 Supplies 1,800 209 Unearned Service Revenue 1,200
153 Equipment 12,000 212 Salaries and Wages Payable 700
301 Owner’s Capital 13,950
$20,450 $20,450

During November, the following summary transactions were completed.

November.
8 Paid $1,700 for salaries due employees, of which $700 is for October salaries.
10 Received $3,620 cash from customers on account.
12 Received $3,100 cash for services performed in November.
15 Purchased equipment on account $2,000.
17 Purchased supplies on account $700.
20 Paid creditors on account $2,700.
22 Paid November rent $400.
25 Paid salaries $1,700.
27 Performed services on account and billed customers for these services $2,200.
29 Received $600 from customers for future service.
Adjustment data consist of:
a) Supplies on hand $1,400.
b) Accrued salaries payable $350.
c) Depreciation for the month is $200.
d) Services related to unearned service revenue of $1,220 were performed.
Instructions
a) Enter the November 1 balances in the ledger accounts.
b) Journalize the November transactions.
c) Post to the ledger accounts. Use J1 for the posting reference. Use the following additional
accounts: No. 407 Service Revenue, No. 615 Depreciation Expense, No. 631 Supplies
Expense, No. 726 Salaries and Wages Expense, and No. 729 Rent Expense.
d) Prepare a trial balance at November 30.
e) Journalize and post adjusting entries.
f) Prepare an adjusted trial balance.
g) Prepare an income statement and an owner’s equity statement for November and a
balance sheet at November 30.

Req.b)
Hamm Equipment Repair
General Journal
For the month of May 31, 2020
Date Accounts Title Ref. Debit ($) Credit ($)
2020 Salaries and Wages Payable 700
Nov-1 Salaries and Wages Expense 1,000
Cash 1,700
-10 Cash 3,620
Accounts Receivable 3,620
-12 Cash 3,100
Service Revenue 3,100
-15 Equipment 2,000
Accounts Payable 2,000
-17 Supplies 700
Accounts Payable 700
-20 Accounts Payable 2,700
Cash 2,700
-22 Rent Expense 400
Cash 400
-25 Salaries and Wages Expense 1,700
Cash 1,700
-27 Accounts Receivable 2,200
Service revenue 2,200
-29 Cash 600
Unearned Service Revenue 600
Req.a & c
Hamm Equipment Repair
(General Ledger)
 Cash
No.101
Date Explanation Ref. Debit Credit Balance
2020
Nov-1 Balance b/d 2,400 2,400
‘’ -1 Salaries and Wages Payable 700 1,700
Salaries and Wages Expense 1,000 700
‘’ -10 Accounts Receivable 3,620 4,320
‘’ -12 Service Revenue 3,100 7,420
‘’ -20 Accounts Payable 2,700 4,720
‘’ -22 Rent Expense 400 4,320
‘’ -25 Salaries and Wages Expense 1,700 2,620
‘’ -29 Unearned Service Revenue 600 3,220

Accounts Receivable
No.112
Date Explanation Ref. Debit Credit Balance
2020
Nov-1 Balance b/d 4,250 4,250
‘’ -10 Cash 3,620 630
‘’ -27 Service Revenue 2,200 2,830

Supplies
No.126
Date Explanation Ref. Debit Credit Balance
2020
Nov -1 Balance b/d 1,800 1,800
‘’ -17 Accounts Payable 700 2,500
‘’ -30 Supplies expense (Adjusting) 1,100 1,400

Equipment
No.153
Date Explanation Ref. Debit Credit Balance
2020
Nov-1 Balance b/d 12,000 12,000
‘’ -15 Accounts Payable 2,000 14,000

Accumulated Depreciation- Equipment

No.154
Date Explanation Ref. Debit Credit Balance
2020
Nov-1 Balance b/d 2,000 2,000
‘’ -30 Depreciation expense (Adjusting) 200 2,200

Accounts Payable
No.201
Date Explanation Ref. Debit Credit Balance
2020
Nov-1 Balance b/d 2,600 2,600
‘’ -15 Equipment 2,000 4,600
‘’ -17 Supplies 700 5,300
‘’ -20 Cash 2,700 2,600

Unearned Service Revenue

No.209
Date Explanation Ref. Debit Credit Balance
2020
Nov -1 Balance b/d 1,200 1,200
‘’ -29 Cash 600 1,800
‘’ -30 Service Revenue (Adjusting) 1,220 580

Salaries and Wages Payable

No.212
Date Explanation Ref. Debit Credit Balance
2020
Nov -1 Balance b/d 700 700
‘’ -1 Cash 700 0
‘’ -30 Salaries and Wages Expense 350 350

Owner’s Capital
No.301
Date Explanation Ref. Debit Credit Balance
2020
Nov-1 Balance b/d 13,950 13,950

Salaries and Wages Expense

No.726
Date Explanation Ref. Debit Credit Balance
2020
Nov-1 Cash 1,000 1,000
‘’ -25 Cash 1,700 2,700
‘’ -30 Salaries and Wages Payable (Adjusting) 350 3,050

Service Revenue
No.407
Date Explanation Ref. Debit Credit Balance
2020
Nov-12 Cash 3,100 3,100
‘’ -27 Accounts Receivable 2,200 5,300
‘’ -30 Unearned Service Revenue (Adjusting) 1,220 6,520

Rent Expense
No.729
Date Explanation Ref. Debit Credit Balance
2020
Nov-22 Cash 400 400

Supplies Expense
No.631
Date Explanation Ref. Debit Credit Balance
2020
Nov-30 Supplies (Adjusting) 1,100 1,100

Depreciation Expense
No.615
Date Explanation Ref. Debit Credit Balance
2020
Nov-30 Accumulated Depreciation- Equipment (Adjusting) 200 200

Req.d)

Hamm Equipment Repair

Trial Balance
For the month ended November 30, 2020
Account Accounts Title Debit Credit
No.
101 Cash 3,220
112 Accounts Receivable 2,830
126 Supplies 2,500
153 Equipment 14,000
154 Accumulated Depreciation-Equipment 2,000
201 Accounts Payable 2,600
209 Unearned Rent Revenue 1,800
212 Salaries and Wages Payable 0
301 Owner’s Capital 13,950
726 Salaries and Wages Expense 2,700
407 Service Revenue 5,300
729 Rent Expense 400
Total 25,650 25,650

Req.e)
Hamm Equipment Repair
Adjusting Journal
For the month ended November 30, 2020
Date Accounts Title Ref. Debit ($) Credit ($)
2020 Supplies Expense [1,800+700]-1,400 1,100
Nov-30 Supplies 1,100
-30 Salaries and Wages Expense 350
Salaries and Wages Payable 350
-30 Depreciation Expense 200
Accumulated Depreciation-Equipment 200
-30 Unearned Service Revenue 1,220
Service Revenue 1,220
Req.f)
Hamm Equipment Repair
Adjusted Trial Balance
For the month ended November 30, 2020
Account Accounts Title Unadjusted Trial Adjustments Adjusted trial
No. Balance Balance
Debit Credit Debit Credit Debit Credit
101 Cash 3,220 3,220
112 Accounts Receivable 2,830 2,830
126 Supplies 2,500 1,100 1,400
153 Equipment 14,000 14,000
154 Accumulated Depreciation- 2,000 200 2,200
Equipment
201 Accounts Payable 2,600 2,600
209 Unearned Service Revenue 1,800 1,220 580
212 Salaries and Wages Payable 0 350 350
301 Owner’s Capital 13,950 13,950
726 Salaries and Wages Expense 2,700 350 3,050
407 Service Revenue 5,300 1,220 6,520
729 Rent Expense 400 400
Total 25,650 25,650
631 Supplies expense 1,100 1,100
615 Depreciation Expense 200 200
Total 2,870 2,870 26,200 26,200