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ABM 12 F Adjusting Entries 2017

1. The document is a trial balance for Big Bird Company on December 31, 2016 that requires adjusting entries. 2. Adjusting entries are made for allowance for bad debts, prepaid supplies, depreciation of furniture, prepaid interest, accrued salaries, prepaid advertising, unearned rent income, correcting salaries expense, recording unrecorded delivery receivable income, and adjusting merchandise inventory and cost of goods sold. 3. Several income and expense accounts are adjusted, inventories and payables are adjusted, and depreciation and interest expenses are properly allocated between time periods in the adjusting entries.

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Baltazar Justiniano
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74 views1 page

ABM 12 F Adjusting Entries 2017

1. The document is a trial balance for Big Bird Company on December 31, 2016 that requires adjusting entries. 2. Adjusting entries are made for allowance for bad debts, prepaid supplies, depreciation of furniture, prepaid interest, accrued salaries, prepaid advertising, unearned rent income, correcting salaries expense, recording unrecorded delivery receivable income, and adjusting merchandise inventory and cost of goods sold. 3. Several income and expense accounts are adjusted, inventories and payables are adjusted, and depreciation and interest expenses are properly allocated between time periods in the adjusting entries.

Uploaded by

Baltazar Justiniano
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd

BIG BIRD COMPANY Dec 11

TRIAL BALANCE 20 days X 100 per day = P2000


DECEMBER 31, 2016 5. Salaries Expense P2,500
Accounts Debit Credit Salaries Payable P2,500
Accounts Receivable 20,000.00 To record Accrued Salaries
Allowance for Bad Debts 1,500.00
Merchandise Inventory 100,000.00 6. Prepaid Advertising P17,500
Prepaid Supplies 1,750.00 Advertising Expense P17,500
Furniture 30,000.00
Accumulated Dep- Furniture 3,000.00 Advertising Expense P30,000 /12 months
Prepaid Interest 6,000.00 2,500 per month advertising
Purchases 120,000.00 August 2,500
Advertising Expense 30,000.00
September 2,500
Rent Expense 20,000.00
October 2,500
Salaries Expense 17,500.00
November 2,500
Utilities Expense 6,600.00
December 2,500
Rent Income 15,000.00
1. Allowance for bad debts should be 10% of Accounts receivables Total 12,500
2. Supplies used up is P750
3. Furniture has a useful life of 10 years P30,000 -17,500 =12,500
4. Prepaid interest for 60 days was paid December 11, 2016.
5. Unpaid salaries amounted to P2,500. Rent Income P10,000
6. Advertising expense 30,000 paid on Aug 1 2016 to FHM for 1 yr. Unearned Rent P10,000
7. Rent Income is for a 6-month rent received on Nov 1, 2016. To correct rent Income
8. Utilities expense P4,400 was charged to salary expense in error.
9. Delivery income of P5,000 for Dec was unrecorded & unpaid.
10. Physical inventory as of December 31, 2016 is P45,000. 7. Rent Income P15,000/ 6 months
Make the necessary adjusting entries 2,500 month
Earned
GENERAL JOURNAL November 1- 30 2500
1. Bad Debt Expense P500 December 1-31 2500
Allowance for Bad Debt P500 Correct Rent Income P5000
To adjust the allowance for Bad Debt Recorded Rent Income 15,000

2. Supplies Expense P750 8. Utilities Expense P4,400


Prepaid Supplies P750 Salaries Expense P4,400
To adjust prepaid supplies To correct salaries expense

3. Depreciation Expense P5,400 9. Delivery Receivable P5 000


Accumulated Depreciation- Furniture P5,400 Delivery Income P5,000
To record delivery receivable
To record Depreciation Expense
10. Merchandise Inventory End P45,000
Entry During Loans Cost of Goods Sold 175,000
Cash in Bank 54,000 Merchandise Inventory Beg P100,000
Prepaid Interest 6000 60days Purchases 120,000
Loans Payable P60,000 To merchandise

Merchandise Beg 100,000


Adjusting
Purchases 120,000
4. Interest Expense P2,000
Total Goods Available 220,000
Prepaid Interest P2000
Less Ending Inventory 45,000
To adjust prepaid interest
Cost of Goods Sold P175,000

P6000 pesos prepaid


60 days
=100 per day
Dec 31

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