Business, 07.03.2020 04:44, BonnyRios

The accounts listed below appeared in the December 31 trial balance of the Savard Theater.

Debit Credit
Equipment $192,000
Accumulated Depreciation—Equipment $ 60,000
Notes Payable 90,000
Admissions Revenue 380,000
Advertising Expense 13,680
Salaries Expense 57,600
Interest Expense 1,400

(a) From the account balances listed above and the information given below, prepare the annual adjusting entries necessary on December 31. (Omit explanations.)

1. The equipment has an estimated life of 16 years and a salvage value of $24,000 at the end of that time. (Use straight-line method.)

2. The note payable is a 90-day note given to the bank October 20 and bearing interest at 8%. (Use 360 days for denominator.)

3. In December 2,000 coupon admission books were sold at $30 each. They could be used for admission any time after January 1.

4. Advertising expense paid in advance and included in Advertising Expense $1,100.

5. Salaries accrued but unpaid $4,700.

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answered: fedora87

Adjusting journal entries

a) 1 . Debit Depreciation $10500 Credit Accumulated depreciation $10500.

2 . Debit interest expense $40 , Credit Bank $40

3 . Debit Admission revenue $ 60000, Credit Unearned admission revenue $60000

4. Debit Prepaid expense $1100 , Credit Advertising expense $1100

5. Debit salary $4700, Credit Salary payable ( accrued salary) $4700

Explanation:

Depreciation = (cost - salvage value)/ useful life

it is said that the equipment has a useful life of 16 years at that date (31 Dec) and depreciation needs to be adjusted for the year. Even even that $192000 is Carrying amount it is not depreciable amount we still need to subtract the salvage value hence (192000- 24000)/16 = $10500 Depreciation

interest expense = 90000*8%*72/360 = $1440

The 72 days numerator is arrived at by adding the remaining 11 days in Oct plus full 30 days Nov plus full 31 days Dec. $1400 of interest has already been recorded so in adjusting to the total of $1440 we need to record $40 of interest.

december coupon = 2000*$30 =$60000

if the coupon admission book revenue for december is not included in the trial balance then its journal entry is debit bank $60000 credit unearned revenue $60000

answered: Guest

Secured loans are protected by collateral security. examples: title loans where the borrower uses the car title as collateral security interest rates are lower and repayments are longer therefore risk is low as a collateral security is given as guarantee to the bank in case of failure to pay the loanunsecured loans are not protected by collateral security but it is given on the creditworthiness of the borrower, trusting that she/he will pay on time. examples; payday loans is a short term loan where the borrower lends money from the bank and pays is back when the borrower receives his/her wages.interest rates are high and repayments are shorter. but the risk is high as no collateral security is given as a guarantee to the bank for payment of the loan

answered: Guest

Hey i just really want alot of points so this is it good

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The accounts listed below appeared in the December 31 trial balance of the Savard Theater.