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College Accounting 2nd Edition by David Haddock, John Price,Michael Farina
Edition 2ISBN: 978-0073396958College Accounting 2nd Edition by David Haddock, John Price,Michael Farina
Edition 2ISBN: 978-0073396958 Exercise 3
The Closing Process
The Trial Balance section of the worksheet for Contemporary Fashions for the period ended December 31, 2013, appears on the next page. Adjustments data are also given.
ADJUSTMENTS
a. Supplies used, $14,400
b. Expired insurance, $9,600
c. Depreciation expense for machinery, $4,800
INSTRUCTIONS
1. Complete the worksheet.
2. Prepare an income statement.
3. Prepare a statement of owner's equity.
4. Prepare a balance sheet.
5. Journalize the adjusting entries in the general journal, page 3.
6. Journalize the closing entries in the general journal, page 4.
7. Prepare a postclosing trial balance.
Analyze: If the adjusting entry for expired insurance had been recorded in error as a credit to Insurance Expense and a debit to Prepaid Insurance for $9,600, what reported net income would have resulted?
The Trial Balance section of the worksheet for Contemporary Fashions for the period ended December 31, 2013, appears on the next page. Adjustments data are also given.
ADJUSTMENTS
a. Supplies used, $14,400
b. Expired insurance, $9,600
c. Depreciation expense for machinery, $4,800
INSTRUCTIONS
1. Complete the worksheet.
2. Prepare an income statement.
3. Prepare a statement of owner's equity.
4. Prepare a balance sheet.
5. Journalize the adjusting entries in the general journal, page 3.
6. Journalize the closing entries in the general journal, page 4.
7. Prepare a postclosing trial balance.
Analyze: If the adjusting entry for expired insurance had been recorded in error as a credit to Insurance Expense and a debit to Prepaid Insurance for $9,600, what reported net income would have resulted?
Explanation
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Verified
$14,440 worth of supplies used is an exp...
College Accounting 2nd Edition by David Haddock, John Price,Michael Farina
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