Answer to Question #238684 in Management for Gundo

Question

Some selected balances of DD Co. for year ended Dec-31-2019 are as follows with their

normal balances before adjustments:

Cash and Cash Equivalent Br 20,000 Owners’ Capital 40,000

Notes Receivables 45,000 Retained Earnings 75,000

Office Supplies 12,000 Sales Revenues 640,000

Prepaid Insurance 72,000 Interest Income 12,000

Inventory (Average Cost) 24,000 Cost of Goods Sold 320,000

Fixed Assets 120,000 Selling Expenses 21,000

Accum. Depr- Fixed assets 36,000 Salary and Wages Expense 105,000

Unearned Rent (Liability) 56,000 Rent Expense 15,000

Required

a. Prepare the necessary adjusting entries for the following items as not yet recorded on

Dec-31-2019:

i. The office supplies consumed during the year is Br 8,000

ii. The Unexpired part of insurance is only Br 26,000

iii. Br 30,000 is earned sales revenues from the unearned advance collection

iv. Salary and wages accrued as on 31-Dec-2019 amounts to be Br 18,000

Answer 1

The answer to your question is provided in the image: