Answer:
T-Accounts:
a) Accrual:
Depreciation Expense - Equipment
Account Title Debit Credit
Accumulated
Depreciation $1,800
Accumulated Depreciation - Equipment
Account Title Debit Credit
Unadjusted balance $5,000
Depreciation 1,800
Bal $6,800
b) Prepaid:
Office Supplies Expense
Account Title Debit Credit
Office Supplies $8,900
Office Supplies
Account Title Debit Credit
Unadjusted balance $9,200
Office supplies expense $8,900
Bal. $300
c) Deferral:
Service Revenue
Account Title Debit Credit
Unadjusted balance $11,300
Unearned Revenue
Account Title Debit Credit
Balance $11,800
Explanation:
Deferral of revenue, prepayment of expenses, and accrual of expenses and revenue are required under the accrual basis of accounting. The accrual basis is supported by the accrual concept which requires that revenue and expenses are accounted or recognized in the period that they relate to and not when the cash is received or paid.
