a. Cardon’s winterized (cleaned and covered) three boats for customers at the end of November, but did not record the service for $2,700.

b. On October 1, 2012, Cardon’s paid $1,200 to the local newspaper for an advertisement to run every Thursday for 12 weeks. All ads have been run except for three Thursdays in December to complete the 12-week contract.

c. Cardon’s borrowed $250,000 at a 12 percent annual interest rate on April 1, 2012, to expand its boat storage facility. The load requires Cardon’s to pay the interest quarterly until the note is repaid in three years. Cardon’s paid quarterly interest on July 1 and October 1.

d. The Johnson family paid Cardon’s $4,500 on November 1, 2012, to store its sailboat for the winter until May 1, 2013. Cardon’s credited the full amount ot Unearned Storage Revenue on November 1.

e. Cardon’s used boat-lifting equipment that cost $220,000 was the estimated depreciation for 2012.

f. Boat repair supplies on hand at December 2, 1011, totaled $16,500. Repair supplies purchased and debited to Supplies during the year amounted to $46,000. The year-end showed $12,400 of the supplies on hand.

g. Wages earned by employees during November 2012, unpaid and unrecorded at November 30, 2012, amounted to $3,800. The next payroll date will be December 5, 2012.


1. Identify each of these transactions as a deferred revenue, deferred expense, accrued revenue, or accrued expense.

2. Prepare the adjusting entries that should be recorded for the Cardon’s at November 30, 2012.