Answer to Question #216122 in Accounting for zuby

Question

Determine if the following adjusting entries are

◦

accrued expense (AE)

◦

prepaid expense (PE)

◦

accrued revenue (AR)

◦

unearned revenue (UR)

1.

_____ Atlas Magazine was previously prepaid $400,000 by subscribers and has delivered half of the magazines ordered.

2.

_____ Hornsby Company agreed to provide 1,000 units of its product to Michaels Inc. and has substantially completed the agreement.

3.

_____ Nancy and Sons owes its employees $30,000 for work done over the past two weeks.

4.

_____ Replay Inc. advertised on TV 44 during the month of April, but has not yet made an entry to record the event.

5.

_____ Centurion Company paid Reliable Insurance Company $54,000 for insurance for twelve months, six of which have passed.

6.

_____ Reliable Insurance Company received a payment of $54,000 for insurance for twelve months from Centurion Company and six months have passed.

Answer 1

1.Unearned revenue (UR)

2.Accrued revenue (AR)

3.Accrued expense (AE)

4.Accrued expense (AE)

5.Unearned revenue (UR)

6.Prepaid expense (PE)