I have attempted this problem and my trial balance ended up not balancing so I am sure I made a mistake in my adjusting entries(Debits and Credits). So, here it goes…Business started on June 1, 2010 and the trial balance was prepared for August 31, 2010.
1. Insurance expires at the rate of $400 a month.
2. A count on Aug 31 shows $600 of supplies on hand. (trial balance shows $3300)
3.Annual depreciation is $6000 on cottages and $2400 on furniture.
4. Unearned rent revenue of $4100 was earned prior to Aug 31.
5. Salaries of $400 were unpaid at Aug 31.
6. Rentals of $1000 were due from tenants at August 31. Use accounts receivable.
7. The mortgage interest rate is 9 % per year. The mortgage was taken out on August 1st.
I had a hard time debiting and crediting the right accounts… please help