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The unadjusted trial balance of the Contracts Plus Company as of December 31 is found on the trial balance tab. The following information is required to prepare the necessary adjusting entries for the Contracts Plus Company 1) The balance in Prepaid insurance represents a 24-month policy that went into effect on December 1. Review the unadjusted balance in Prepaid insurance, and prepare the necessary adjusting entry, if any. 2) Based on a physical count supplies on hand total $3,150. Review the unadjusted balance in Supplies, and prepare the necessary adjusting entry, if any. 3) The equipment is expected to have an 5-year useful life, and be worth about $12,000 at the end of five years. Review the unadjusted balance in Accumulated depreciation, and prepare the necessary adjusting entry to record the monthly depreciation, If any 4) On December 26, the client paid a $10,200 60-day fee in advance, covering December 27 to February 24. Review the unadjusted balance in Unearned Consulting Revenue, and prepare the necessary adjusting entry, if any. 5) Contracts Plus's employee earns $140 per day for a five-day workweek beginning on Monday and ending on Friday. The employee was last paid on Friday, December 26. Review the unadjusted balance in Salaries expense, and prepare the necessary adjusting entry, if any 6) In the second week of December, Contracts Plus agreed to provide 30 days of consulting services to a local fitness club for a fixed fee of $4,380. The terms of the initial agreement call for Contracts Plus to provide services from December 12, through January 10, or 30 days of service. The club agrees to pay Contracts Plus $4,380 on January 10, when the service period is complete. Review the unadjusted balance in Consulting revenue, and prepare the necessary adjusting entry, if any. General Journal General Ledger Trial Balance Requirement Income Statement St Retained Earnings Balance Sheet Impact on income In chapter 2, we learned how to prepare journal entries for external transactions; transactions between the company and other entities. In this chapter, we will review the trial balance to see if the balances have remained accurate, or whether they have become inaccurate as a result of internal transactions (I.e. the use of supplies, or the use of insurance coverage). This question will review the unadjusted trial balance presented in chapter 2, and demonstrate the adjusting entry process used to ensure the accuracy of the general ledger balances prior to the preparation of financial statements. General Journal tab - For transactions 1-6, review the unadjusted balance and prepare the adjusting entry necessary to correctly report the revenue earned or the expense incurred. General Ledger tab - Each journal entry is posted automatically to the general ledger. Use the drop-down button to view the unadjusted or adjusted balances. Trial Balance tab. You may view either the unadjusted or adjusted balances by choosing from the dropdown box below. Your choice will determine the reported values on the financial statement tabs. Income Statement, Statement of Retained earnings, Balance Sheet tabs - The financial statements will display the unadjusted or adjusted balances, based on your selection. Impact on Income tab - For each adjustment, indicate the income statement and balance sheet account affected, and the impact on net income. If an adjustment caused net income to decrease, enter the amount as a negative value. Net income balne demante ran he found on the inenme statement tab. (Hint: Select unadiusted on the drondown. Journal entry worksheet 2 3 4 5 6 The balance in Prepaid insurance represents a 24-month policy that went into effect on December 1. Review the unadjusted balance in Prepaid insurance, and prepare the necessary adjusting entry, if any. Note: Enter debits before credits. Date Account Title Debit Credit Dec 31 000: No journal entry required 101: Cash 106: Accounts receivable 126: Supplies 128: Prepaid insurance Record ei View general journal 167. Fouinment 168: Accumulated depreciation - Equipment 201: Accounts payable 209: Salaries payable 236: Unearned consulting revenue 307: Common stock 318: Retained earnings 319: Dividends 403: Consulting revenue 406: Rental revenue ord ei 612: Depreciation expense - Equipment View ge Date Account Title Debit Cr Dec 31 622: Salaries expense 637: Insurance expense 640: Rent expense 652: Supplies expense Record ei 690: Utilities expense View Journal entry worksheet 1 2 3 4 5 5 6 Based on a physical count, supplies on hand total $3,150. Review the unadjusted balance in Supplies, and prepare the necessary adjusting entry, if any. Note: Enter debits before credits Date Account Title Debit Credit Dec 31 Record entry Clear entry View general journal Journal entry worksheet Contracts Plus's employee earns $140 per day for a five-day workweek beginning on Monday and ending on Friday. The employee was last paid on Friday, December 26. Review the unadjusted balance in Salaries expense, and prepare the necessary adjusting entry, if any. Note: Enter debits before credits. Date Account Title Debit Credit Dec 31 Record entry Clear entry View general journal Journal entry worksheet In the second week of December, Contracts Plus agreed to provide 30 days of consulting services to a local fitness club for a fixed fee of $4,380. The terms of the initial agreement call for Contracts Plus to provide services from December 12, through January 10, or 30 days of service. The club agrees to Note: Enter debits before credits. Date Account Title Debit Credit Dec 31 Record entry Clear entry View general journal Unadjusted General Ledger Account Unadjusted Adjusted Cash Supplies No. Debit Credit No. Debit Credit Date Dec 31 Balance 24.295 Date Dec 31 Balance 4,200 Prepaid insurance Debit Equipment Debit No. Date Credit Balance No. Credit Date Dec 31 Dec 31 3,000 Balance 33,000 Accounts payable Debit Credit Unearned consulting revenue Debit Credit No. No. Date Date Dec 31 Balance 8,200 Balance 10.200 Dec 31 Common stock No. Dividends Debit Date Debit Credit Balance 42,000 No. Date Credit Balance 1,500 Rental revenue Consulting revenue Debit Credit No. No. Date Date Dec 31 Balance 9,400 Debit Credit Balance 500 Dec 31 Rent expense Salaries expense Debit Credit No. No. Date Date Dec 31 Debit Credit Balance 2,380 Balance 1,600 Dec 31 Utilities expense Debit Credit No. Dato Dec 31 Balance 325 Requirement General Journal General Ledger Trial Balance Income Statement St Retained Earnings Balance Sheet Impact on income You may view either the unadjusted or adjusted trial balance by choosing from the drop-down box below. Your choice will determine the reported values on the financial statement tabs. Unadjusted Unadjusted Adjusted Contracts Plus Trial Balance December 31, 2016 Account Title Debit Credit $ 24,295 4,200 3,000 33,000 8,200 10,200 42,000 Cash Supplies Prepaid insurance Equipment Accounts payable Uneamed consulting revenue Common stock Dividends Consulting revenue Rental revenue Salaries expense Rent expense Utilities expense Total 1,500 9,400 500 2,380 1,600 325 70,300 $ 70,300 Unadjusted Contracts Plus Unadjusted Adjusted Income Statement For Month ended December 31, 2019 Revenues: Expenses: Unadjusted Contracts Plus Unadjusted Adjusted Income Statement For Month ended December 31, 2019 Revenues: 101: Cash 106: Accounts receivable 126: Supplies 128: Prepaid insurance 167: Equipment Unadjusted Unadjusted Adjusted Revenues: Contracts Plus Income Statement For Month ended December 31, 2019 201: Accounts payable 209: Salaries payable 307: Common stock 318: Retained earnings 319: Dividends ANICAL DLL Unadjusted Contracts Plus Unadjusted Adjusted Income Statement For Month ended December 31, 2019 Revenues: 403: Consulting revenue 406: Rental revenue 612: Depreciation expense - Equipment 622: Salaries expense 637: Insurance expense 610 Dant avnanca Unadjusted Contracts Plus Unadjusted Income Statement Adjusted For Month ended December 31, 2019 Revenues: 622: Salaries expense 637: Insurance expense 640: Rent expense 652: Supplies expense 690: Utilities expense Requirement General Journal General Ledger Trial Balance Income Statement St Retained Earnings Balance Sheet The unadjusted or adjusted balances will appear for each account, based on your selection. Unadjusted Contracts Plus Unadjusted tement of Retained Earnings Adjusted onth ended December 31, 2019 Retained earnings, December 1, 2019 $ Add: Net income Less: Dividends Retained earnings, December 31, 2019 0 (1,500) Use the drop-downs to select the accounts properly included on the balance sheet. The unadjusted or adjusted balances will appear for each account, based on your selection. Include all balance sheet accounts, even those with zero balances. Unadjusted Unadjusted Adjusted Contracts Plus Balance Sheet December 31, 2019 Assets Liabilities Equity + 42,000 42,000 Total liabilities and equity Unadjusted Contracts Plus Unadjusted Adjusted Balance Sheet December 31, 2019 Assets $ 0 0 0 101: Cash 0 0 0 106: Accounts receivable 126: Supplies 128: Prepaid insurance 0 Liabilities Equity 42,000 42,000 Total liabilities and equity For each adjustment, indicate the income statement and balance sheet account affected, and the impact on net income. If an adjustment caused net income to decrease, enter the amount as a negative value. Net Income before adjustments can be found on the income statement tab. (Hint: Select unadjusted on the dropdown.) Unadjusted Dates: Dec 31 to: Dec 31 Account affecting the Impact on net Adjusting entry related to: Income statement Balance Shoot Income Insurance Supplies Depreciation Fees collected in advance Salaries Work performed in advance Total impact on income due to adjustments $ 0 Balance Sheet Impact on income on ne me Adjusted For each adjustment, indicate the income statement and balance sheet account affected, and the impact on net income. If an adjustment caused net income to decrease, enter the amount as a negative value. Net income before adjustments can be found on the income statement tab. (Hint: Select unadjusted on the dropdown.) Unadjusted Dates: Dec 31 to: Dec 31 Account affecting the Unadjusted Dec 31 ted to: Balance Sheet Dec 31 Income statement Dec 31 Dec 31 Supplies Depreciation Fees collected in advance Salaries Work performed in advance 101: Cash Total impact on income due to adjustments 106: Accounts receivable 126: Supplies 128: Prepaid insurance 0 0

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