Sunkan Company prepares monthly financial statements – MGMT 30A Midterm 1 Practice Exam

Sunkan Company prepares monthly financial statements – MGMT 30A Midterm 1 Practice Exam

Sunkan Company prepares monthly financial statements. Below are listed some selected accounts and their balances on the September 30 trial balance before any adjustments have been made for the month of September.

SUNKAN COMPANY

Trial Balance (Selected Accounts)

September 30, 2014

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Debit                Credit

Supplies ………………………………………………………………………….        $ 2,700

Prepaid Insurance …………………………………………………………….       $ 4,800

Equipment ………………………………………………………………………      $ 16,200

Accumulated Depreciation—Equipment ……………………………………………….         $ 1,000

Unearned Rent Revenue ………………………………………………………………………        $ 1,200

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(Note: Debit column does not equal credit column because this is a partial listing of selected account balances.)

An analysis of the account balances by the company’s accountant provided the following additional information:

  1. A physical count of office supplies revealed $1,000 on hand on September 30.
  2. A two-year life insurance policy was purchased on June 1 for $4,800.
  3. Office equipment depreciates $3,000 per year.
  4. The amount of rent received in advance that remains unearned at September 30 is $300.

Instructions:

Using the information given, prepare the adjusting entries that should be made by Sunkan Company on September 30.

Course: MGMT 30A – Principles of Accounting I
Assignment: Midterm 1 Practice Exam
School: University of California, Irvine

  • : 07/02/2017
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