Answer:
1. Cullumber Company borrowed $9,400 by signing a 9%, one-year note on September 1, 2020.
Dr Cash 9,400
Cr Notes payable 9,400
December 31, 2020, adjusting entry
Dr Interest expense 282
Cr Interest payable 282
2. A count of supplies on December 31, 2020, indicates that supplies of $970 are on hand.
December 31, 2020, adjusting entry
Dr Supplies expense 1,230
Cr Supplies 1,230
3. Depreciation on the equipment for 2020 is $2,000.
December 31, 2020, adjusting entry
Dr Depreciation expense 2,000
Cr Accumulated depreciation, equipment 2,000
4. Cullumber Company paid $3,120 for 12 months of insurance coverage on June 1, 2020.
December 31, 2020, adjusting entry
Dr Insurance expense 1,820
Cr Prepaid insurance 1,820
5. On December 1, 2020, Cullumber collected $28,000 for consulting services to be performed from December 1, 2020, through March 31, 2021. The company had performed 1/4 of the services by December 31.
Dr Cash 28,000
Cr unearned revenue 28,000
December 31, 2020, adjusting entry
Dr Unearned revenue 7,000
Cr Service revenue 7,000
6. Cullumber performed consulting services for a client in December 2020. The client will be billed $4,200.
December 31, 2020, adjusting entry
Dr Accounts receivable 4,200
Cr Service revenue 4,200
7. Cullumber Company pays its employees total salaries of $5,600 every Monday for the preceding 5-day week (Monday through Friday). On Monday, December 29, employees were paid for the week ending December 26. All employees worked the last 3 days of 2020.
December 31, 2020, adjusting entry
Dr Wages expense 3,360
Cr Wages payable 3,360
