DISCUSSION ON ADJUSTMENTS AND COMPLETION

QUESTION 1
Given the following work sheet with the trial balance already entered, and the adjustment information, complete
the work sheet.
Stride Company, Work Sheet, Year Ended December 31, 20X6
Account Trial Balance Adjustments Adj. Trial Bal. Inc. Statement Balance Sheet
Dr. Cr. Dr. Cr. Dr. Cr. Dr. Cr. Dr. Cr.
Cash 25
A/R 15
Supplies 8
Equipment 35
Accum.
Depn.- Equipment
A/P 8
Salary
Payable
Unearned Service 31
Revenue
Jane Smith, Capital 30
Jane Smith, 5
Withdrawals
Service 41
Revenue
Salary 10
Expense
Rent 8
Expense
Advertising 4
Expense
Supplies Expense
Depn. Expense-
Equipment
110 110
Adjustments information:
a) Supplies used, $4.
b) Depreciation on equipment, $6.
c) Unearned service revenue earned during period, $12.
d) Accrued salaries, $3.
e) Accrued service revenue, $4.

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DISCUSSION ON ADJUSTMENTS AND COMPLETION

QUESTION 2
Given the following work sheet with the trial balance already entered, and the adjustment information,
complete the work sheet.
Diet Right Products, Work Sheet
Year Ended December 31, 20X3
Account Trial Balance Adjustments Adj. Trial Bal. Inc. Statement Balance Sheet
Dr. Cr. Dr. Cr. Dr. Cr. Dr. Cr. Dr. Cr.
Cash 5,000
A/R 2,300
Prepaid 1,200
Insurance
Supplies 500
Equipment 9,800
Accum. 1,200
Depn.-Equipment
A/P 2,000
Salary
Payable
Unearned Service 5,550
Revenue
Roe, Capital 9,950
Roe, 1,200
Withdrawals
Service 8,500
Revenue
Salary 4,500
Expense
Rent 1,000
Expense
Advertising 400
Expense
Utilities Expense 1,300
Supplies
Expense
Depn. Expense-
Equipment
Insurance Expense
27,200 27,200
Adjustments information:
a)Accrued salaries, $170; b)Supplies used, $120; c) Unexpired prepaid insurance, $650
d) Unearned service revenue on December 31, 20X3, $3,200; e)Depreciation expense, $900;
f) Accrued service revenue, $500

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DISCUSSION ON ADJUSTMENTS AND COMPLETION

QUESTION 3
Practice question- adjustments and worksheet
Given below are the accounts balances for Scooby Co., and the necessary adjustments at year end. All
accounts carry normal balances.
Scooby Co., Account Balances
Year Ended December 31, 2010
Accounts $
Cash 29000
Accounts Rec. 22000
Inventory 43000
Insurance 12000
Supplies 13000
Prepaid Rent 7000
Land 120000
Furniture 21000
Accumulated Depreciation-Furniture 10000
Accounts Payable 32000
Salary Payable 0
Unearned Sales Revenue 17000
Share Capital 160000
Dividends 10000
Sales Revenue  112000
Sales Discounts 7000
Sales Returns and Allowances 5000
Cost of Goods Sold 33000
Salary Expense 17000
Insurance Expense 0 
Rent Expense 0
Supplies Expense 0 
Utilities Expense 10000
Depreciation Expense-Furniture 0
Retained earnings  18000
Adjustments at year end:
i. Prepaid rent that has expired is $1000
ii. Annual depreciation for furniture is $2500
iii. Unearned sales revenue earned during the period is $4000
iv. Salaries to employees that is not paid yet, $4000
v. Ending inventory count shows an amount of $38,000
vi. Insurance expired during the period is $2000
vii. Supplies balance at year end is $3000
Required:
a) Insert the account balances into its appropriate columns in the worksheet. [25 marks]
b) Consider the adjustments and insert them onto appropriate columns. [14 marks]
c) Complete the 10-column worksheet. [11 marks]

Scooby Co., Accounting Worksheet

Year Ended December 31, 2010
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 DISCUSSION ON ADJUSTMENTS AND COMPLETION

  Trial balance Adjustments Adjusted Income Statement Balance sheet

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 DISCUSSION ON ADJUSTMENTS AND COMPLETION

Accounts Debit Credit Debit Credit Debit Credit Debit Credit Debit Credit
Cash
Accounts Rec.
Inventory
Insurance
Supplies
Prepaid Rent
Land
Furniture
Accumulated
Depreciation-
Furniture
Accounts Payable
Salary Payable
Unearned Sales
Revenue
Share Capital
Dividends
Sales Revenue
Sales Discounts
Sales Returns and
Allowances
Cost of Goods Sold
Salary Expense
Insurance Expense
Rent Expense
Supplies Expense
Utilities Expense
Depreciation
Expense-Furniture
Retained earnings
 
Net income
 

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DISCUSSION ON ADJUSTMENTS AND COMPLETION

QUESTION 4
The following accounts appear in the adjusted trial balance columns of a work sheet. State the column that
each account balance is extended to, choosing from the following columns:
1) income statement debit
2) balance sheet debit
3) income statement credit
4) balance sheet credit

a) _________ service revenue

b) _________ unearned service revenue
c) _________ land
d) _________ rent expense
e) _________ supplies expense
f) _________ supplies
g) _________ accumulated depreciation
h) _________ equipment
i) _________ owner's capital
j) _________ owner's withdrawals

QUESTION 5
Britt Jewelers had the following transactions in April. Prepare journal entries for these transactions
assuming Britt Jewelers uses a perpetual inventory system.
Apr. 2 Britt received an $18,000 invoice from one of its suppliers. Terms were 2/10 n/30, FOB shipping
point. Britt paid the freight bill amounting to $2,000.
4 Britt returned $2,500 of the merchandise billed on April 2 because it was defective.
5 Britt sold $8,000 of merchandise on account, terms 3/15 n/30. The cost of the merchandise sold
was $5,500.
10 Britt paid the invoice dated April 2, less the return and the discount.
15 A customer returned $2,500 of merchandise sold on April 5. The cost of the returned
merchandise was $1,450.
19 Britt received payment on the remaining amount due from the sale of April 5, less the return and
the discount.

QUESTION 6
Details of purchase invoices including shipping terms, credit terms, and returns appear below. Compute the
total amount to be paid in full settlement of each invoice, assuming that credit for returns is granted before
the expiration of the discount period and payment is made within the discount period.
Invoice Freight and Credit Terms Transportation Returns and
Charges Allowances
a) $2,000 FOB destination, 3/10 n/45 $55 $200
b) $5,500 FOB shipping point, 2/10 n/30 $100 $50
c) $6,700 FOB shipping point, 2/10, n/45 $200 $350
d) $9,300 FOB destination, 2/15 n/60 $150 $550