Do I record deprication in the following question
Purchased supplies at a cost of 14,000. Assume the above items have a 2 year life with no salvage value.
And also how do I record this
Invested 80,000 of your own money to start the business
|
Do I record deprication in the following question
Purchased supplies at a cost of 14,000. Assume the above items have a 2 year life with no salvage value.
And also how do I record this
Invested 80,000 of your own money to start the business
One typically does not record depreciation on supplies.
The biggest reason is that it usually is not material.
Also supplies usually don't last for a long time.
Investing 80,000 of your own money…
Dr. Cash 80,000
Cr. Equity/Donated Capital/Shares 80,000
It actually said a printer and a scanner for the supplies
Oh, well that could be qualified as Equipment then. Since when does a printer and scanner only last for 2 years?
In that case, assuming 14,000 is material to your company, I would depreciate it.
How do you write that?
When you but the Equipment for 14,000 the JE would be:
Dr. Equipment 14,000
Cr. Cash 14,000
After year 1 and after year 2, the JE is the same:
Dr. Depreciation Expense 7,000
Cr. Accumulated Depreciation 7,000
THANK YOU!!
OK I have another question. How do you write the adjusted journal entry for
DR:cash 80000
CR:capital 80000
And also
DR:cash 6000
CR:revenue 6000
Quote:
Originally Posted by jsu4549m
Those 2 JE do not require any adjusting entries. The second one, the part dealing with Sales, that account has to be closed to Retained Earnings at the end of the year.
OK I'm sooo sorry but I have another question
It says purchased 1,200 worth of supplies for cash
So DR: supplies and CR: cash
Then for my adjusting entry I DR:supplies and CR: supplies expense
I don't think that is right, let me know what you think
Quote:
Originally Posted by jsu4549m
You have the first JE correct.
The second one, you need to reverse it. Debit Supplies Expense and Credit Supplies.
OK one more I have DR:cash CR:AR for my JE
And DR:AR CR:revenue for my adjusting entry is that right
I don't follow this.Quote:
Originally Posted by jsu4549m
What was the transaction all about?
It said... collected 8,000 from the client billed earlier, which said provided services for a client. Sent him a bill for 15,000
Ok, so when you send the bill to the customer:
Dr. AR 15,000
Cr. Sales 15,000
When you received the cash…
Dr. Cash 8,000
Cr. AR 8,000
OK I got that but how do you do an adjusting entry for the DR:cash 8000 CR:AR 8000
What do you mean?
80000.00 is owners equity.
Don't you have to do an adjusting entry if it's a cash entry
No.
The "adjustment" would be you get cash, and you draw down the AR you set up with the sale.
OK I can't get this, I'm supposed to make adjusting entries to these things if needed and she said there was 11
DR:cash 80000
CR:capital 80000
DR:cash 30000 this was borrowed 30000 from bank by sugning a 6 month 10% note
CR:NP 30000
DR:Prepaid rent 6000
CR:cash 6000
DR:prepaid ins. 2400
CR:cash 2400
DR:Equipment 14000 this one had 2 year life
CR:cash 14000
DR:equipment 5000 this one had 5 year life
CR:cash 5000
DR:advertising exp 6000
CR:cash 6000
DR:supplies 2000
CR:AP 2000
DR:cash 6000
CR:revenue 6000
DR:AR 15000
CR:revenue 15000
DR:salary exp 1500
CR:cash 1500
DR:supplies 1200
CR:cash 1200
DR:cash 8000
CR: 8000
DR:AP 2000
CR:cash 2000
DR:cash 20000
CR:unearned rev 20000
| All times are GMT -7. The time now is 01:42 AM. |