Hello I am really confused on how to record these transactions:

1. Amortized $60 of the discount on bonds payable.

This is how I recorded it:

Amortization Expense Debit $60
Discount on Bonds Payable Credit $60

Evidently the amortization expense is in correct. Could you please help?


2. Collected $9,874 of accounts receivables

This is how I recorded it:

Accounts Receivables Debit of $9,874
Cash Credit of $9,874

I am thinking that I should have reversed these accounts but I am not sure.


3. Bought Stock in Excellent Company for $950 in cash. Your company has no plans to sell the shares of stock in the next few years.

My Answer:
Marketable Securities Debit of $950
Cash Credit of $950

I am thinking that the marketable securities should be available for sale securities.

4. a fire destroyed $732 of merchandise and equipment which cost $1,426 and had a book value of $985. Filed insurance claim but have not received money from the insurance company. The fire was considered unusual and infrequent.

This is how I recorded it:
Extraordinary Loss on Merchandise and Equipment Debit 732
Merchandise and Equipment Credit 985
Depreciation Expense Debit 253

I was told to separate the merchandise and equipment and that the depreciation expense account is incorrect along with the figures of $732 and $985. I am so unsure what to do at this point.


5. Of the rent paid in part "M" above one of the months is in 2010. Rent paid during 2008 has expired.
"M" READS: Paid $2,700 of rent on February 1 to renew the one year lease which began in 2008.

I recorded M as:
Rent Expense Debit 2,700
Cash Credit 2,700

I recorded Question 5 as:
Prepaid Rent Debit 225
Rent Expense Credit 225

I was told that the account numbers for five are wrong. I changed the accounts on Question 5 from a debit of Rent Expense and a credit of prepaid rent to read what it says now.

Quote:

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1. Amortized $60 of the discount on bonds payable.

This is how I recorded it:

Amortization Expense Debit $60
Discount on Bonds Payable Credit $60

Evidently the amortization expense is in correct. Could you please help?

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Um... you're sure the amortization expense is correct? At least in the U.S. we generally charge that off to interest expense. (But it most definitely is an expense.) The credit is correct. Bonds payable is a credit account, so a discount (which reduces it) would be a debit account. When you amortize a premium or discount, you are removing a portion from the account. So since discount is a debit account, to remove the 60, it would be a credit.

Quote:

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2. Collected $9,874 of accounts receivables

This is how I recorded it:

Accounts Receivables Debit of $9,874
Cash Credit of $9,874

I am thinking that I should have reversed these accounts but I am not sure.

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Yes, you should have reversed them. ;) Both are debit accounts. If you're collecting cash, that means it's going up, so debit. It also means the customer is paying on their account, which reduces the amount they owe, so you have to reduce the receivable. Since that's a debit account, reducing means crediting it.

Quote:

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3. Bought Stock in Excellent Company for $950 in cash. Your company has no plans to sell the shares of stock in the next few years.

My Answer:
Marketable Securities Debit of $950
Cash Credit of $950

I am thinking that the marketable securities should be available for sale securities.

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I would agree.

Quote:

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4. a fire destroyed $732 of merchandise and equipment which cost $1,426 and had a book value of $985. Filed insurance claim but have not received money from the insurance company. The fire was considered unusual and infrequent.

This is how I recorded it:
Extraordinary Loss on Merchandise and Equipment Debit 732
Merchandise and Equipment Credit 985
Depreciation Expense Debit 253

I was told to separate the merchandise and equipment and that the depreciation expense account is incorrect along with the figures of $732 and $985. I am so unsure what to do at this point.

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Um... a little confusing. For the separation they're referring to the credits. The two asset accounts are separate accounts. Also 985 is the book value for the equipment. So not only does it not apply to the merchandise account at all, the equipment account would not contain 985. It contains 1426 and the accumulated depreciation contains the difference between 1426 and book value. (Review where book value comes from.)

I assume by saying the depreciation account is incorrect that it's not supposed to be there at all. (Versus dollar amount) I don't know where you came up with that dollar amount. You would need to catch up depreciation first because the amount depreciated thus far is a different issue that the loss. But because the problem giving you a book value, I would have assumed it was already caught up. It doesn't say book value at the beginning of the year; just says that's what the book value was ("was" I assume at the time of the loss). But I AM making an assumption there.

Quote:

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5. Of the rent paid in part "M" above one of the months is in 2010. Rent paid during 2008 has expired.
"M" READS: Paid $2,700 of rent on February 1 to renew the one year lease which began in 2008.

I recorded M as:
Rent Expense Debit 2,700
Cash Credit 2,700

I recorded Question 5 as:
Prepaid Rent Debit 225
Rent Expense Credit 225

I was told that the account numbers for five are wrong. I changed the accounts on Question 5 from a debit of Rent Expense and a credit of prepaid rent to read what it says now.

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The accounts you have now are correct. It depends on how the original was recorded. The original entry you did for #5 (dr expense/cr prepaid) would be correct if you had recorded the original "M" entry in the prepaid account. Because you'd have to move the expired portion down to the expense. But since you recorded the original in the expense account, you have to move the unexpired portion up to the prepaid.

Thank you for your help!

On number 4 what would the correct transaction/journal entry be? I have been trying to figure this out for the longest time...

On number 5 is the amount correct (225)?