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    Class Example and Notes Taking - 0915 - RASHA YATMEEN

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    Rasha Yatmeen
    This document provides examples of accrued revenues, accrued expenses, and other adjusting journal entries. It explains that accrued revenues are amounts collected but not yet matched to expenses, while accrued expenses are amounts not yet paid but already matched to earnings. Examples are given for recording accrued interest payable, accrued salaries, bad debt expense, and depreciation expense through adjusting entries. Adjusting entries are necessary to record revenues and expenses in the proper period.

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    Class Example and Notes Taking - 0915 - RASHA YATMEEN

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    Rasha Yatmeen
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    This document provides examples of accrued revenues, accrued expenses, and other adjusting journal entries. It explains that accrued revenues are amounts collected but not yet matched to expenses, while accrued expenses are amounts not yet paid but already matched to earnings. Examples are given for recording accrued interest payable, accrued salaries, bad debt expense, and depreciation expense through adjusting entries. Adjusting entries are necessary to record revenues and expenses in the proper period.

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    This document provides examples of accrued revenues, accrued expenses, and other adjusting journal entries. It explains that accrued revenues are amounts collected but not yet matched to expenses, while accrued expenses are amounts not yet paid but already matched to earnings. Examples are given for recording accrued interest payable, accrued salaries, bad debt expense, and depreciation expense through adjusting entries. Adjusting entries are necessary to record revenues and expenses in the proper period.

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    10 views2 pages

    Class Example and Notes Taking - 0915 - RASHA YATMEEN

    Uploaded by

    Rasha Yatmeen
    This document provides examples of accrued revenues, accrued expenses, and other adjusting journal entries. It explains that accrued revenues are amounts collected but not yet matched to expenses, while accrued expenses are amounts not yet paid but already matched to earnings. Examples are given for recording accrued interest payable, accrued salaries, bad debt expense, and depreciation expense through adjusting entries. Adjusting entries are necessary to record revenues and expenses in the proper period.

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    Class example and notes taking_0915 – RASHA YATMEEN

    Example 1
    An accrued revenue can best be described as an amount
    a. collected and currently matched with expenses.
    b. collected and not currently matched with expenses.
    c. not collected and currently matched with expenses. Answer
    d. not collected and not currently matched with expenses.
    Example 2: Accrued Revenues.
    In October Pioneer Advertising performed services worth $2,000 that were not billed clients
    before Oct. 31. Prepare the entry to revenues for services performed.
    Accounts Receivable $2000
    Service Revenue $2000

    Example 3
    An accrued expense can best be described as an amount
    a. paid and currently matched with earnings.
    b. paid and not currently matched with earnings.
    c. not paid and not currently matched with earnings.
    d. not paid and currently matched with earnings. Answer
    Example 4: Accrued Expenses
    Accrued Interest. Pioneer signed a three-month, 12%, note payable in the amount of $50,000 on
    October 1. Prepare the adjusting entry on Oct. 31 to record the accrual of interest.
    Interest Expense $500
    Interest Payable $500

    Example 5: CPA exam question:


    In reviewing a set of journal entries, an auditor encounters an entry composed to a debit to
    interest expense and a credit to interested payable, The purpose of this journal entry is to record:
    A. An accrued expense Answer
    B. A deferred expense
    C.A contingent liability
    D. An unexpired cost
    Example 6 Accrued Salaries.
    Employees receive total salaries and wages of $10,000 for a five-day work week, or $2,000 per
    day. Prepare the adjusting entry on Oct. 31 to record accrual for salaries.
    Salaries and wages expense $6000
    Salaries and wages payable $6000

    Accrued Salaries. On November 23, Pioneer will again pay total salaries and wages of $40,000.
    Prepare the entry to record the payment of salaries on November 23.
    Salaries and wages payable $6000
    Salaries and wages expense $34000
    Cash $40000

    Example 7:
    Bad Debts. Pioneer Advertising reasonably estimates a bad debt expense for the month of
    $1,600. Prepare the entry to record the bad debts for the month of October.
    Bad Debt Expense $1600
    Allowance for bad debt expense $1600

    Example 8: Depreciation.
    Pioneer Advertising estimates depreciation on its office equipment to be $400 per month.
    Prepare the entry to record depreciation for the month of October.
    Depreciation expense $400
    Accumulated depreciation $400
    Example 9: CPA exam question:
    Why are adjusting entries necessary:
    A. To record revenues and expenses Answer B. To make debits equal to credits
    C. To close nominal accounts at year end D. To correct erroneous balances in accounts

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