Question :At the beginning of the year, office supplies of $1,200 were on hand. During the year, Tempo Air Conditioning Service paid $4,000 for more office supplies. At the end of the year, Tempo has $800 of office supplies on hand. Requirements 1. Record the adjusting entry assuming that Tempo records the purchase of office supplies by initially debiting an asset account. Post the adjusting entry to the Office Supplies and Supplies Expense T-accounts. Make sure to include the beginning balance and purchase of office supplies in the Office Supplies T-account. 2. Record the adjusting entry assuming that Tempo records the purchase of office supplies by initially debiting an expense account. Post the adjusting entry to the Office Supplies and Supplies Expense T-accounts. Make sure to include the beginning balance in the Office Supplies T-account and the purchase of office supplies in the Supplies Expense T-account. 3. Compare the ending balances of the T-accounts under both approaches. Are they the same?
Adjusting entries are as follows:
Accounts and Explanation
To record office supplies used.
T accounts are as follows:
Actual Office Supplies Used is calculated as follows:
Adjustment for Office Supplies Used is calculated as follows:
Question :Consider the facts presented in the following table for Tropical View:Beginning Prepaid Rent Payments for Prepaid Rent during the year Total amount to account for Subtract: Ending Prepaid Rent Rent Expense Situation A B C D $1,400 700 2,100 800 $ a $1,000 1,600 700 $900 b $ 200 1,800 $1,900 c d $ 700 f e 600 $1,000Complete the table by filling in the missing values.
Identify the impact on the income statement and balance sheet if adjusting entries for the following situations were not recorded. a. Office Supplies used, $800. b. Accrued service revenue, $4,000. c. Depreciation on building, $3,500. d. Prepaid Insurance expired, $650. e. Accrued salaries expense, $2,750. f. Service revenue that was collected in advance has now been earned, $130
Question: Total Pool Services earned $130,000 of service revenue during 2018. Of the $130,000 earned, the business received $105,000 in cash. The remaining amount, $25,000, was still owed by customers as of December 31. In addition, Total Pool Services incurred $85,000 of expenses during the year. As of December 31, $10,000 of the expenses still needed to be paid. In addition, Total Pool Services prepaid $5,000 cash in December 2018 for expenses incurred during the next year. 1. Determine the amount of service revenue and expenses for 2018 using a cash basis accounting system. 2. Determine the amount of service revenue and expenses for 2018 using an accrual basis accounting system.
Protection Home provides house-sitting for people while they are away on vacation. Some of its customers pay immediately after the job is finished. Some customers ask that the business send them a bill. As of the end of the year, Protection Home has collected $900 from cash-paying customers. Protection Home’s remaining customers owe the business $1,300. How much service revenue would Protection Home have for the year under the a. cash basis? b. accrual basis?
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