Accounting
Problem 4.4A
Preparing Adjusting Entries from a Trial Balance
The Off-Campus Theater adjusts its accounts every month. Below is the company’s unadjusted trial balance dated July 31, 2002. Additional information is provided for use in preparing the company’s adjusting entries for the month of July. (Bear in mind that adjusting entries have already been made for the first seven months of 2002, but not for July.)
OFF-CAMPUS THEATER
Unadjusted Trial Balance
July 31, 2002 Cash $ 16,200 Prepaid film rental 28,000 Land 100,000 Building 240,000 Accumulated depreciation: building $ 16,000 Fixtures and equipment 12,000 Accumulated depreciation: fixtures and equipment 3,000 Notes payable 190,000 Accounts payable 3,200 Unearned admissions revenue (YMCA) 1,200 Income taxes payable 6,100 Capital Stock 50,000 Retained earnings 29,440 Dividends 11,000 Admissions revenue 290,200 Concessions revenue 17,460 Salaries expense 62,900 Film rental expense 87,000 Utilities expense 6,300 Depreciation expense: building 3,000 Depreciation expense: fixtures and equipment 1,500 Interest expense 8,500 Income taxes expense 30,000 ________ $606,400 $606,400
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Other Data 1. Film rental expense for the month is $14,200. However, the film rental expense for several months has been paid in advance. 2. The building is being depreciated over a period of 40 years (480 months). 3. On the first of each month, the theater pays the interest which accrued in the prior month on its note payable. At July 31, accrued interest payable on this note amounts to $1,583. 4. The theater allows local nursing homes to bring seniors to the movies on any weekday afternoon for a fixed price of $400 per month. On June 30, the nursing home made a $1,200 advance
Preparing Adjusting Entries from a Trial Balance
The Off-Campus Theater adjusts its accounts every month. Below is the company’s unadjusted trial balance dated July 31, 2002. Additional information is provided for use in preparing the company’s adjusting entries for the month of July. (Bear in mind that adjusting entries have already been made for the first seven months of 2002, but not for July.)
OFF-CAMPUS THEATER
Unadjusted Trial Balance
July 31, 2002 Cash $ 16,200 Prepaid film rental 28,000 Land 100,000 Building 240,000 Accumulated depreciation: building $ 16,000 Fixtures and equipment 12,000 Accumulated depreciation: fixtures and equipment 3,000 Notes payable 190,000 Accounts payable 3,200 Unearned admissions revenue (YMCA) 1,200 Income taxes payable 6,100 Capital Stock 50,000 Retained earnings 29,440 Dividends 11,000 Admissions revenue 290,200 Concessions revenue 17,460 Salaries expense 62,900 Film rental expense 87,000 Utilities expense 6,300 Depreciation expense: building 3,000 Depreciation expense: fixtures and equipment 1,500 Interest expense 8,500 Income taxes expense 30,000 ________ $606,400 $606,400
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Other Data 1. Film rental expense for the month is $14,200. However, the film rental expense for several months has been paid in advance. 2. The building is being depreciated over a period of 40 years (480 months). 3. On the first of each month, the theater pays the interest which accrued in the prior month on its note payable. At July 31, accrued interest payable on this note amounts to $1,583. 4. The theater allows local nursing homes to bring seniors to the movies on any weekday afternoon for a fixed price of $400 per month. On June 30, the nursing home made a $1,200 advance