Accounting 26th Edition by Carl Warren ,Jim Reeve ,Jonathan Duchac

Exercise 25

Adjusting entries
Selected account balances before adjustment for Alantic Coast Realty at July 31, 2016, the end of the current year, are as follows:

Data needed for year-end adjustments are as follows:
a. Unbilled fees at July 31, $11,150.
b. Supplies on hand at July 31, $900.
c. Rent expired, $6,000.
d. Depreciation of equipment during year, $8,950.
e. Unearned fees at July 31, $2,000.
f. Wages accrued but not paid at July 31, $4,840.
Instructions
1. Journalize the six adjusting entries required at July 31, based on the data presented.
2. What would be the effect on the income statement if adjustments (a) and (f) were omitted at the end of the year
3. What would be the effect on the balance sheet if adjustments (a) and (f) were omitted at the end of the year
4. What would be the effect on the "Net increase or decrease in cash" on the statement of cash flows if adjustments (a) and (f) were omitted at the end of the year