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    Midterm Exam-Adjusting Entries

    Uploaded by

    Hassanhor Guro Bacolod
    1. The document provides information and instructions for adjusting entries related to accruals, deferrals, prepayments, and precollected income for an accounting midterm exam. It includes examples of accrued expenses, accrued income, unearned income, prepaid expenses, and prepaid income. 2. Students are asked to prepare adjusting entries on December 31, 2019 for accrued salaries, interest payable on notes payable, accrued utilities, accrued interest receivable, rent receivable, and interest receivable. 3. They are also asked to prepare entries upon receipt of cash and adjusting entries for December 31 for unearned rent income, unearned retainer's fees, unearned advertising

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    Midterm Exam-Adjusting Entries

    Uploaded by

    Hassanhor Guro Bacolod
    772 views5 pages
    1. The document provides information and instructions for adjusting entries related to accruals, deferrals, prepayments, and precollected income for an accounting midterm exam. It includes examples of accrued expenses, accrued income, unearned income, prepaid expenses, and prepaid income. 2. Students are asked to prepare adjusting entries on December 31, 2019 for accrued salaries, interest payable on notes payable, accrued utilities, accrued interest receivable, rent receivable, and interest receivable. 3. They are also asked to prepare entries upon receipt of cash and adjusting entries for December 31 for unearned rent income, unearned retainer's fees, unearned advertising

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    1. The document provides information and instructions for adjusting entries related to accruals, deferrals, prepayments, and precollected income for an accounting midterm exam. It includes examples of accrued expenses, accrued income, unearned income, prepaid expenses, and prepaid income. 2. Students are asked to prepare adjusting entries on December 31, 2019 for accrued salaries, interest payable on notes payable, accrued utilities, accrued interest receivable, rent receivable, and interest receivable. 3. They are also asked to prepare entries upon receipt of cash and adjusting entries for December 31 for unearned rent income, unearned retainer's fees, unearned advertising

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    772 views5 pages

    Midterm Exam-Adjusting Entries

    Uploaded by

    Hassanhor Guro Bacolod
    1. The document provides information and instructions for adjusting entries related to accruals, deferrals, prepayments, and precollected income for an accounting midterm exam. It includes examples of accrued expenses, accrued income, unearned income, prepaid expenses, and prepaid income. 2. Students are asked to prepare adjusting entries on December 31, 2019 for accrued salaries, interest payable on notes payable, accrued utilities, accrued interest receivable, rent receivable, and interest receivable. 3. They are also asked to prepare entries upon receipt of cash and adjusting entries for December 31 for unearned rent income, unearned retainer's fees, unearned advertising

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    ACCTG1B

    MIDTERM EXAMINATION
    ACCRUALS & DEFERRALS

    PART 1: ACCRUALS

    ACCRUED EXPENSES:
    Based on the following data, prepare the necessary adjusting entries on December 31, 2019.
    Support your entries with the needed computation

    1. salaries already earned by the Salaries expense P 90,000


    Salaries payable P 90,000
    employees but not yet paid as of
    December 31, P 90,000

    Interest expense 140, 000


    2. A 6-month, 10% note payable for interest payable 140, 000
    350,000 x .12 x 20/6 = 140, 000
    P350, 000, dated October 1, is
    outstanding as of December 31.

    Utilities expense 6,000


    3. utilities already incurred but not Utilities payable 6,000
    yet paid P 6,000
    PART 2: PRECOLLECTION

    ACCRUED INCOME

    Transactions Adjusting entry


    December 31

    1. The Notes Receivable account


    Interest receivable P4,500
    has a balance of P450,000
    interest income P 4,500
    representing a
    120-day, 12% note received on
    December 1. The Interest on the 450, 000 x .12 x 30/360= P 4,500
    note is collectible upon
    maturity.

    2. Rent due and uncollected from


    Rent receivable 50,000
    the tenants for the month of
    rent income 50,000
    December, P 50,000

    3. A 180-day, 9% note receivable Interest receivable 2, 310


    for P220,000, dated December Interest income 2, 310
    21, is outstanding as at 220,000 x .09 x 21/180= 2, 310
    December 31
    PART 3

    PRECOLLECTED INCOME

    Based on the following data, prepare the entries

    1. upon receipt of cash and


    2. The necessary adjusting entries at the end of the current calendar
    year
    1. On November 1, Rent Income 125,000
    Unearned Rent Cash 150,000 Unearned rent income
    Income was credited Rent Income 150,000
    for p150,000 125,000
    representing rental unearned=150,000 x 10/12
    for 12 months = 125,000

    2. On November 1,
    2019 , Atty. Mijares Retainer’s fees 10,000
    received P60,000 as Unearned retainer’s fees
    her retainer’s fees for Cash 60,000
    professional services Retainer’s fees 10,000
    which was credited 60,000
    to Unearned Unearned=30,000 x
    retainer’s fees to be 1/3=10,000
    rendered until April
    30, 2020

    3. Mina Creative Arts


    received P 240,000 cash 240,000 service fees 90, 000
    from a customer service fees 240,000 unearned service fees 90, 000
    representing
    advertising fees for
    a period of 24 unearned= 240,000 x 9/24=
    months beginning 90, 000
    October 1, 2019
    PART 4
    PREPAYMENTS

    Based on the following data, prepare the entries upon receipt of cash and
    necessary adjusting entries at the end of the current calendar year
    Interest Upon Payment Of ADJUSTING ENTRY, December
    Cash 31, 2019

    1. Interest paid on bank


    loan, debited to Interest expense 900 Prepaid interest 600
    prepaid interest Cash 900 Interest expense 600
    expense account , for
    the period of 60 days
    from December 11, prepaid= 900 x 40/60
    amounted to P 900 = 600

    2. Store supplies debited


    to the store supplies Prepaid store supplies Store sup. expense 17,250
    account during the 28, 750 Prepaid store supplies 17,250
    year, P28, 950. As of
    December 31, Cash 28, 750
    P11,500 is used expense= 28,750-11,500
    = 17,250

    3. Of the P12,000
    balance of the Insurance expense
    insurance expense 12,000 Prepaid insurance 3,000
    account, P9,000 was Insurance expense 3,000
    unexpired during the Cash 12,000
    prepaid= 12,000-9,000
    current year =3,000

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