tsantillo
Oct 4, 2009, 06:18 PM
1. Services provided but unbilled and uncollected at July 31 were $1,812.
2. Depreciation on equipment for the month was $280.
3. One-twelfth of the insurance expired.
4. An inventory count shows $360 of cleaning supplies on hand at July 31.
5. Accrued but unpaid employee salaries were $447.
My answers are:
1. Salaries exp. 1812
Service revenue 1812
2. Depreciation exp. 280
Accumulated depreciation 280
3.
4. cleaning supplies exp. 579
Cleaning supplies 579
5. salaries exp. 447
Salaries payable 447
If anyone could check my answers id really appreciate it
helemuo
Oct 4, 2009, 09:10 PM
tsantillo,
Your calculations are correct. But how did you get $579 expense from item no4. You probably have more info on it that you stated.
morgaine300
Oct 7, 2009, 02:58 AM
Actually, there is one error here. And I'm not sure how someone can determine that your "calculations" are correct when we can't see any.
1. Salaries exp. 1812
service revenue 1812
About three things wrong here. One, you'll never use an expense and a revenue together in an entry. Revenue is when you're doing work for someone else and expenses are when someone else is doing it for you. They're opposites. Second, I don't know where you're getting salaries out of this. Unless you're thinking of "services" as the salary you earn. Companies don't earn "salaries." That's something they pay to their employees. This is what the company is providing to their customers and has nothing to do with the employees. The revenue part is correct because it's something the company earned.
And third, being uncollected means the customers still owe it. What account do you use for something your customers still owe?
Now, #3. You need to calculate 1/12th of the insurance. That is a deferred expense, otherwise known as a prepaid. You pay the insurance up front and that makes it an asset as you have coverage coming to you. (Assets include things you have a claim on that have some value to you. This is something "usable," in a sense.) Once an asset has expired or been used up, it turns into an expense.
ALL deferred expenses will be a debit to the expense and a credit to the asset account.
4. cleaning supplies exp. 579
cleaning supplies 579
The accounts are correct. There isn't any way to check the number because you haven't provided the balance from the account prior to the entry. However... the usual mistake would be to use the 360 in the entry, or to use 360 in part of it and 579 in part of it. Since you have used an entirely different number, it would be my assumption that you subtracted from the balance and therefore did that correctly. But obviously I can't know that for sure.
All else is correct.