Answer:
See explanation Section
Explanation:
Adjusting Entries
Req. A, B
A. <em>Since the partial amount of insurance policy has been expired-</em>
Debit Insurance Expense $3,203
Credit Prepaid Insurance $3,203
An expense will be appeared and the current assets will be decreased.
B. Debit Teaching supplies Expense $7,528
Credit Teaching supplies $7,528
<em>As the company has $2,776 supplies available from $10,304, teaching supplies expense will appear as $7,528 = (10,304 - 2,776)</em>
Req. C, D, and E
C. Debit Depreciation expense-equipment $12,814
Credit Accumulated depreciation-equipment $12,814
D. Debit Depreciation expense-professional library $6,407
Credit Accumulated depreciation-professional library $6,407
E. Debit Unearned revenue $5,600
Credit Service revenue $5,600
<em>Note: Monthly fee of $2,800 from November to December. Therefore, 2 months fee = $2,800*2 = $5,600 has been earned.</em>
Req. F, G and H
F. Debit Accounts receivable $8,750
Credit Service revenue $8,750
<em>Note: As WTI has not yet received any payment from October 15 to December 31, there will be 2 and a half months bill due. Each month = 3,500. Therefore, 2 months = $7,000, and a half-month = $(3,500 ÷ 2) = $1,750. Total receivable = $7,000 + $1,750 = $8,750.</em>
G. Debit Salaries expense $400
Credit Salaries payable $400
<em>Note: As there are two employees and two days salary have been accured, total salaries payable = $100 per day × 2 employees × 2 days = $400</em>
H. Debit Rent Expense $2,062
Credit Prepaid rent $2,062
