Question

The following transactions occurred during the first year of operations for Cougar Corp. for each transaction prepare the year-end adjusting journal entry. Note: these ARE adjusting entries. a. Cougar Corp. purchased $4,300 in supplies during the year. A count at the end of the year showed that $650 of the supplies are still on hand. b. Cougar Corp. needs to record depreciation for its Vehicles. The depreciation amount is $4,100. c. Cougar Corp. owes its employees $5,700 for work performed this year. Cougar Corp. plans to pay the $5,700 in the first week of the next year. d. Cougar Corp. collected cash of $12,000 from a customer earlier in the year and recorded it properly. $9,500 of the work was performed before year-end and no revenue entries have been recorded yet for this work. e. Cougar Corp. paid $4,800 on October 1 for 4-months of rent. Since October 1, no entries have been made.

Answer 1

Answer:

The year-end adjusting journal entry will be as presented below:

Explanation:

a. Cougar Corp. purchased $4,300 in supplies during the year. A count at the end of the year showed that $650 of the supplies are still on hand.

Details                                                    Dr ($)                  Cr ($)      

Supplies expenses                               3,650

Supplies ($4,300 - $650)                                                3,650

(To record supplies expenses for the year.)                                  

b. Cougar Corp. needs to record depreciation for its Vehicles. The depreciation amount is $4,100.

Details                                                    Dr ($)                  Cr ($)      

Depreciation                                         4,100

Accumulated dep. - Vehicles                                          4,100

(To record Vehicles' depreciation expenses for the year.)            

c. Cougar Corp. owes its employees $5,700 for work performed this year. Cougar Corp. plans to pay the $5,700 in the first week of the next year.

Details                                                    Dr ($)                  Cr ($)      

Wages expenses                                  5,700

Accrued wages                                                                 5,700

(To record employees' wages expenses for the year.)                  

d. Cougar Corp. collected cash of $12,000 from a customer earlier in the year and recorded it properly. $9,500 of the work was performed before year-end and no revenue entries have been recorded yet for this work.

Details                                                    Dr ($)                  Cr ($)      

Cash                                                      12,000

Revenue                                                                             9,500

Unearned revenue (12,000 - 9,500)                                2,500

(To record revenue and unearned for the year.)                            

e. Cougar Corp. paid $4,800 on October 1 for 4-months of rent. Since October 1, no entries have been made.

Details                                                    Dr ($)                  Cr ($)      

Rent expenses (4,800 * 3/4)                3,600

Prepayments - Rent (4,800 * 1/4)          1,200

Cash                                                                                  4,800

(To record rent expenses for the year and rent prepayment.)