The ledger of Chopin Rental Agency on March 31 of the current year includes the following selected accounts before adjusting entries have been prepared.
|
|
Debit |
Credit |
|
|
Prepaid Insurance |
$3,600 |
||
|
Supplies |
2,800 |
||
|
Equipment |
25,000 |
||
|
Accumulated Depreciation-Equipment |
$8,400 |
||
|
Notes Payable |
20,000 |
||
|
Unearned Rent Revenue |
6,300 |
||
|
Rent Revenue |
60,000 |
||
|
Interest Expense |
-0- |
||
|
Wage Expense |
14,000 |
An analysis of the accounts shows the following.
1. The equipment depreciates $250 per month.
2. One-third of the unearned rent was earned during the quarter.
3. Interest of $500 is accrued on the notes payable.
4. Supplies on hand total $650.
5. Insurance expires at the rate of $300 per month.
Prepare the adjusting entries at March 31, assuming that adjusting entries are made quarterly. Additional accounts are: Depreciation Expense; Insurance Expense; Interest Payable; and Supplies Expense.
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