Give an example of one of the four adjusting entries for an actual company. My introductory post, below will give an example of each type to get you started. Then I want you to think of just one for any of the 4 types. To get things started, here is one example of each of the four types of Adjusting Journal Entries. 1. Prepaid Expenses: Larry’s Fun House bought $600 in Food and Beverages in July. In August, the business used up $250 of those supplies. Here is the adjusting journal entry: DR Food and Beverages Expense $250 CR Food and Beverages $250 2.
Give an example of one of the four adjusting entries for an actual company. My introductory post, below will give an example of each type to get you started. Then I want you to think of just one for any of the 4 types. To get things started, here is one example of each of the four types of Adjusting Journal Entries. 1. Prepaid Expenses: Larry’s Fun House bought $600 in Food and Beverages in July. In August, the business used up $250 of those supplies. Here is the adjusting journal entry: DR Food and Beverages Expense $250 CR Food and Beverages $250 2. Unearned Revenues: Allstate Insurance customers paid for car insurance for 6 months. The local office recorded $720,000 in premiums paid for July 1 through December 31. Here is the adjustment for the month of October: DR Unearned Revenue $120,000 Revenues $120,000 3. Accrued Revenues: The City of Greensboro bills customers once per month. Dr. Mereba, a customer of the Water Company received her bill for $35. The adjusting JE for the City of Greensboro Water Company is: DR Accounts Receivable $35 CR Service Revenues $35 4. Accrued Expenses: Elaine’s Spa pays her employees weekly. Payday is every Friday. At the end of October, the business owes $4,000 to its employees, but payday is not until Friday, November 4. The adjustment to accrue wages is: DR Wages Expense $4,000 CR Wages Payable $4,000 Now, all you have to do is think of an adjusting journal entry to show, for any one of the 4 types. Here are some businesses that record adjustments regularly. Any business where customers prepay them for things like insurance, rent. If the customer is a business, it also makes an adjustment as the asset turns into an expense Any business that has depreciable assets Any business that buys supplies for several months at a time A business that bills its customers once…
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