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Varvara68 [4.7K]
1 year ago
8

E3-33B. (Learning Objectives 1, 3: Journalizing adjusting entries and analyzing their

Business
1 answer:
myrzilka [38]1 year ago
7 0

The act of logging any transaction, whether or not it is an economic one, is known as a journal entry. Transactions are listed in an accounting journal that shows a company's debit and credit balances.

<h3>Give a brief account on adjusting journal entries.</h3>

An adjusting journal entry is one that is made at the end of an accounting period in the general ledger of a business to record any unrealized income or expenses that occurred during the period. An adjusting journal entry is necessary to accurately account for a transaction that happens between two accounting periods.

To solve the question :

1. Adjusting journal entries are as follows :

Particulars                                                                  Debit.                Credit

a. Insurance expense A/c

($800 + $2,500 - $2,400)                                          $600

To prepaid insurance A/c                                                             $600

(entry for expired portion of

prepaid insurance)  

b. Interest receivable A/c                                           $1,200

To interest revenue A/c                                                             $1,200

(adjusting entry for

accrued interest revenue)  

c. Unearned service revenue A/c ($1,500 - $600)    $900

To service revenue A/c                                                                       $900

(entry for earned portion of

unearned service revenue)  

d. Depreciation expense A/c                                           $4,700

To accumulated depreciation A/c                                             $4,700

(To record depreciation expenses)  

e. Salaries Expense A/c

($24,000 / 5 days × 3 days)                                             $14,400

To Salaries payable A/c                                                           $14,400

(To record accrued salaries expenses)  

f. Income tax expense A/c

($21,000 × 25%)                                                          $5,250

To income tax payable A/c                                                            $5,250

(To record income tax expenses)

2. Calculating whether these omitted adjustments resulted in an overstatement or underestimate of net income

a. Adjusting Entry for Insurance Expense of $600 : Overstated

b. Adjusting Entry for accrued revenue of $1,200 : Understated

c. Adjusting entry for Service Revenue Earned of $900 : Understated

d. Adjusting Entry for Depreciation Expense of $4,700 : Overstated

e. Adjusting Entry for Salaries Expense for

three day of $14,400 : Overstated

f. Adjusting Entry for Income Tax Expense of $5,250 : Overstated

Impact on Net Income without Adjusting Entries of $22,850 : Overstated

To know more about, journal entries, visit :
brainly.com/question/15889958

#SPJ1

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Simko Company issued $750,000, 8-year, 6 percent bonds on January 1, 2018. The bonds were issued for $710,000. Interest is payab
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Answer:

Bond issuance:

Dr cash                                          $710,000

Dr discount on bonds payable    $40,000

Cr bonds payable                                           $750,000

The payment of interest on December 31, 2018:

Dr interest expense     $50,000

Cr discount on bonds payable    $5000

Cr cash                                           $45,000

Explanation:

The bonds were issued at a discount to their face value, as a result, the discount on bonds payable is computed thus:

discount on bonds payable=$750,000-$710,000=$40,000

Bonds payable would be credited with $750,000 while cash and discount on bonds payable would be debited with $710,000 and $40,000 respectively

annual discount amortization=$40,000/8=$5000

annual coupon=$750,000*6%=$45000

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Some spending and taxes increase or decrease with the business cycle. This event often has an effect on the economy that is simi
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Answer: Automatic stabilizers

Explanation:

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The automatic stabilizer is also known as the economical policy and the activity is done without any government intervention. In this system, the income and taxes are get decreased or increased in the business cycle.

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All of the following are expenses associated with home ownership that should be planned for early in the process except
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According to the given question, the emergence of the smartphones industry with the different types of given application best illustrating the industry convergence concept.

Therefore, Option (D) is correct answer.

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A standard "money demand" function used by macroeconomists has the form ln( ) = + ln( ) + m β , 0 β1 GDP β2R Where m is the quan
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Answer:

1.The money demand will rise by 1.154%

2. The money demanded will fall and for a 1% increase in interest , the money demanded will fall by 0.38%

Explanation:

1. Money demand function

ln(m) = β0 +β1 ln(GDP)+β2R

Suppose β1 = 1.5 , β2 = −0.04 , GDP = $ 100 & R = 3%

ln(m) = 1.5 ln ($100) - 0.04 X 0.03

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Suppose the GDP increases by 1%; the new GDP will be = $ 101  

ln(m) = 1.5 ln ($101) - 0.04 X 0.03

ln(m) = 6.92

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If the GDP increases by 1% ,the money demand will rise by 1.154%

2.

If the interest rate increases from 3% to 4%

ln(m) = 1.5 ln ($100) - 0.04 X 0.04  

ln(m) = 6.906155

m = $ 998.400

If the interest rate rises from 3% to 4% , the money demanded will fall and for a 1% increase in interest , the money demanded will fall by 0.38%

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3 years ago
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