Accounting - Debits & Credits PRACTICE

Suppose that on January 1, Callilane Travel Company paid cash of $40,000 for equipment that is expected to remain useful for 5 years. Record the entry for the annual depreciation.

Debit Depreciation Expense - Equipment (8,000), Credit Accumulated Depreciation - Equipment (8,000): Annual Depreciation = 40,000 ÷ 5 years = 8,000

Since the second half-month amount of $900 will be paid on July 1, Aladdin makes an adjusting entry on June 30. Whats the adjusting entry?

Debit Salary Expense (900), Credit Salary Payable (900)

Suppose that on June 3 Aladdin Travel purchased equipment with a loan for $24,000. Aladdin's equipment will remain useful for five years and then be worthless. What is the annual depreciation and monthly depreciation?

Annual Depreciation = 24,000 ÷ 5 = 4800 per year Monthly Depreciation = 4,800 ÷ 12 = 400 per month

Journalize Brislte earning service revenue of $ 18,000 on account and then collecting $ 6,000 on account. Record Brilte earning $18,000 of service revenue on account

Debit Accounts Receivable (18,000), Credit Service Revenue (18,000)

Assume that on June 15 a hotel agrees to pay Aladdin a commission of $600 for booking 100 clients into its hotel over the next 30 days. Aladdin books 50 clients in June and 50 in July. Aladdin will earn half a month's fee, $300. For work done June 15 through June 30. What is the adjusting entry for June 30?

Debit Accounts Receivable (300), Credit Service Revenue (300)

On November 1, 2001, FSA Corp. paid $900 for 6 months of advertising from November to April. FSA recorded this cost as Prepaid Advertising. Which of the following should FSA record on December 31 (assuming no adjusting entries were made previously)?

Debit Advertising Expense (300), Credit Prepaid Advertising (300): (900 ÷ 6) x 2

Journalize Brislte earning service revenue of $ 18,000 on account and then collecting $ 6,000 on account. Journalize Brislte receiving $4,000 in advance and then earning $1,500 as service revenue. Record Brislte cash collections in advance of services being performed.

Debit Cash (4,000), Credit Unearned Service Revenue (4,000)

Assuming Disney World Resorts pays Aladdin $400 monthly, beginning immediately, if it books up to eight clients into the resort within. 30-day period. If Aladdin Travel collects the first amount on June 15, what is the journal entry?

Debit Cash (400), Credit Unearned Service Revenue (400)

Journalize Brislte earning service revenue of $ 18,000 on account and then collecting $ 6,000 on account. Record the entry to show Brislte collecting $6,000 for a portion of the revenue previously earned on account.

Debit Cash (6,000), Credit Accounts Receivable (6,000)

Depreciation for the current year includes Equipment $1,100

Debit Depreciation Expense (1,100), Credit Accumulated Depreciation (1,100)

Suppose that on June 3 Aladdin Travel purchased equipment with a loan for $24,000. Aladdin's equipment will remain useful for five years and then be worthless. One way to compute the amount of depreciation for each year is to divide the cost of the asset ($24,000 in our example) by its expected useful life (5 years). For June related to the June 3rd purchase. What is the adjusted journal entry?

Debit Depreciation Expense - Equipment (400), Credit Accumulated Depreciation - Equipment (400): Monthly Depreciation for one month

A company purchases a machine for its manufacturing facility for $90,000 in January and as of December has recorded only 11 months of depreciation. The machinery is estimated to have a useful life of 5 years. What is the proper entry to record the year-end adjustment for depreciation, assuming the straight-line method is used?

Debit Depreciation Expense - Machine (1,500), Credit Accumulated Depreciation (1,500): (90,000 ÷ 5 years = 1800 per year; 18,000 ÷ 12 months = 1,500 per month)

The Groundhog Ranch Company pertains to December 31, 2018, which is the end of the company's year long accounting period. The Accumulated Depreciation Building at beginning of the year is $100,000. Depreciation on building is $14,000. What is the journal entry at years end?

Debit Depreciation Expense Building (14,000), Credit Accumulated Depreciation Building (14,000)

The Groundhog Ranch Company pertains to December 31, 2018, which is the end of the company's year long accounting period. The Accumulated Depreciation Furniture and Fixtures at the beginning of the year was $50,000. Depreciation on furniture and fixtures is $17,000. What is the journal entry at years end?

Debit Depreciation Expense Furniture and Fixtures (17,000), Credit Accumulated Depreciation Furniture and Fixtures (17,000)

Suppose that on June 3 Aladdin Travel purchased equipment with a loan for $24,000. What is the journal entry?

Debit Equipment (24,000), Credit Note Payable (24,000)

Suppose that on January 1, Callilane Travel Company paid cash of $40,000 for equipment that is expected to remain useful for 5 years. Record the purchase of equipment on January 1

Debit Equipment (40,000), Credit Cash (40,000)

The Groundhog Ranch Company pertains to December 31, 2018, which is the end of the company's year-long accounting period. Accrued income tax expense is $37,000. What is the journal entry?

Debit Income Tax Expense (37,000), Credit Income Tax Payable (37,000)

Aladdin Travel Inc. would make an additional adjusting entry to accrue income tax expense 600 and the related income tax payable as the final adjusting entry of the period. What is the journal entry?

Debit Income Tax Expense (600), Credit Income Tax Payable (600)

Insurance for the next six months was paid on November 1st in the amount of $810. Record the journal entry for insurance expired at year end.

Debit Insurance Expense (270), Credit Prepaid Insurance (270): (810 ÷ 6 months) X 2 = 270

Incurred Interest Expense of $1,600

Debit Interest Expense (1,600), Credit Interest Payable (1,600)

Due to the terms of its​ lease, Sparrow ​Services, Inc., pays the rent for its new office space in one annual payment of $ 36, 000 on August ​1, 2018. The lease covers the period of August ​1, 2018​, through July ​31, 2019. Sparrow Services has a​ year-end of December 31. Assume that Sparrow Services had no other prepaid rent​ transactions, nor did it have a Prepaid Rent beginning balance in 2018. Give the journal entries that Sparrow Services would make for​ the annual rent payment of $ 36, 000 on August 1​, 2018

Debit Prepaid Rent (36,000), Credit Cash (36,000)

You pay $3,000 on December 1st for 3 months of rent.

Debit Prepaid Rent, Credit Cash

Due to the terms of its​ lease, Sparrow ​Services, Inc., pays the rent for its new office space in one annual payment of $ 36, 000 on August ​1, 2018. The lease covers the period of August ​1, 2018​, through July ​31, 2019. Sparrow Services has a​ year-end of December 31. Assume that Sparrow Services had no other prepaid rent​ transactions, nor did it have a Prepaid Rent beginning balance in 2018. Give the journal entries that Sparrow Services would make for​ the adjusting entry for rent expense on December 31, 2018

Debit Rent Expense (15,000), Credit Prepaid Rent (15,000): Prepaid Rent Amount (36,000) ÷ 12 Months = Monthly Depreciation (3,000) Monthly Depreciation (3,000) X 5 Months = 15,000

Suppose Aladdin Travel Inc. prepays three months' store rent, $3,000, on June 1. What is the entry for the prepayment of three months' rent?

Debit Rent Expense, Credit Cash

Throughout June, Prepaid Rent carries the balance of $3,000. On June 30, an adjusting entry is required because Aladdin has "used" one month of the rent.

Debit Rent Expense, Credit Prepaid Rent, (3000 ÷ 3 = 1000)

Employees earned $3,500 in salaries that will be paid next month.

Debit Salaries Expense (3500), Credit Salaries Payable (3,500)

The Groundhog Ranch Company pertains to December 31, 2018, which is the end of the company's year long accounting period. Salary Expense at the beginning of the year is $174,000. Salaries owed but not yet paid is $9,000. What is the journal entry?

Debit Salary Expense (9,000), Credit Salary Payable (9,000)

Suppose Aladdin Travel Inc pays its employee a monthly salary of $1,800, half on the 15th of June and half on the last day of the month. Assume the payday falls on a Sunday, Aladdin pays the employee on the following Monday. What's the journal entry? During June, Aladdin paid its employees the first half-month salary of $900. What is the journal entry for the first half of the month?

Debit Salary Expense (900), Credit Cash (900)

Used office supplies of $1,100

Debit Supplies Expense (1,100), Credit Supplies (1,1000)

The Groundhog Ranch Company pertains to December 31, 2018, which is the end of the company's year long accounting period. The supplies account at the beginning of the year was $16,000. Supplies on hand at year end was $1,800. What is the journal entry?

Debit Supplies Expense (14,200), Credit Supplies (14,200): Supplies at Beginning (16,000) - Supplies on hand at year end (1,800) = 14,200

The unadjusted balance of Office Supplies at Dec 31 is $5,200 and at year end the office supplies on hand totaled $1,300.

Debit Supplies Expense (3,900), Credit Supplies (3,900) : Unadjusted Balance at year end (5,200) - Supplies on hand (1,300) = 3,900

On June 2, Aladdin Travel paid cash of $700 for cleaning supplies. A count at June 30 indicates that $400 of supplies remain on hand.

Debit Supplies Expense, Credit Supplies. (700 - 400 = 300)

On June 2, Aladdin Travel paid cash of $700 for cleaning supplies.

Debit Supplies, Credit Cash

Completed services that were paid for six months earlier, $600

Debit Unearned Revenue (600), Credit Service Revenue (600)

Journalize Brislte earning service revenue of $ 18,000 on account and then collecting $ 6,000 on account. Record the entry to show Brislte earning $1,500 of the service revenue that was collected in advance.

Debit Unearned Service Revenue (1,500), Credit Service Revenue (1,500)

The June 30 unadjusted trial balance lists Unearned Service Revenue with a $400 credit balance. During the last 15 days of the month, Aladdin Travel books four clients into Disney-world Resort to earn 1/2 of the $400. On June 30, what is Aladdin's adjusted journal entry?

Debit Unearned Service Revenue (200), Credit Service Revenue (200): 400 ÷ 2 = 200

The Groundhog Ranch Company pertains to December 31, 2018, which is the end of the company's year-long accounting period. Of the $31,000 balance of unearned service revenue, $28,000 year-long during the year. What is the journal entry

Debit Unearned Service Revenue (28,000), Credit Service Revenue (28,000)

Suppose that on January 1, Callilane Travel Company paid cash of $40,000 for equipment that is expected to remain useful for 5 years. What is the equipment's book value on December 31?

Equipment at cost (40,000) - Accumulated Depreciation Equipment (8,0000) = Book Value at December 31 (32,0000)