Question

Prepare the adjusting entry for Rolando Caypuno Company under each of the following situations:

a. The Office Supplies account showed a beginning debit balance of P6,000 and purchases of P10,000. The ending debit balance was P4,000.

b. Depreciation for the office building is estimated to be P76,000.

c. A one-year insurance policy was purchased for P60,000. The company has been covered for the last four months.

d. Accrued interest on notes payable amounted to P15,000.

e. The company received a P144,000 advance payment during the year on services to be performed. By year-end, two-thirds of the services had been performed.

f. Payroll for the five-day workweek, to be paid on Friday, is P140,000. The last day of the period is a Wednesday.

g. Services totaling P7,800 had been performed but not yet billed or recorded.

please po!​

Answer 1

The preparation of the adjusting entries for Rolando Caypuno company are as follows:

Adjusting Journal Entries:

a. Debit Office Supplies Expenses $12,000

Credit Office Supplies P12,000

b. Debit Depreciation Expenses P76,000

Credit Accumulated Depreciation P76,000

c. Debit Insurance Expense P20,000

Credit Prepaid Insurance P20,000

d. Debit Interest Expense P15,000

Credit Interest Payable P15,000

e. Debit Deferred Service Revenue P96,000

Credit Service Revenue P96,000

f. Debit Wages Expense P140,000

Credit Wages Payable P140,000

g. Debit Accounts Receivable P7,800

Credit Service Revenue P7,800

What are adjusting entries:

Adjusting entries are entries made at period-year to record all expenses incurred for the period but not paid for in cash or revenues earned but not received in cash.

Other adjusting entries include depreciation expenses and losses.

Transaction Analysis:

a. Office Supplies Expenses $12,000 Office Supplies P12,000

b. Depreciation Expenses P76,000 Accumulated Depreciation P76,000

c. Insurance Expense P20,000 Prepaid Insurance P20,000

d. Interest Expense P15,000 Interest Payable P15,000

e. Deferred Service Revenue P96,000 Service Revenue P96,000

f. Wages Expense P140,000 Wages Payable P140,000

g. Accounts Receivable P7,800 Service Revenue P7,800

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