Generally Accepted Accounting Principles and Trial Balance

Problem set C
PROBLEM 3-1C
For each of the following entries, enter the letter of the explanation that most closely describes it in the space beside each entry. (You can use letters more than once.) A. To record receipt of unearned revenue. B. To record this period’s earning of prior unearned revenue. C. To record payment of an accrued expense.
D. To record receipt of an accrued revenue.
E. To record an accrued expense.
F. To record an accrued revenue
G. To record this period’s use of a prepaid expense.
H. To record payment of a prepaid expense. I. To record this period’s depreciation expense.

______ 1. Interest Expense 600 Interest Payable 600
______ 2. Interest Payable 600 Cash 600
______ 3. Interest Receivable 1,400 Interest Earned 1,400
______ 4. Cash 1,400 Interest Receivable 1,400
______ 5. Depreciation Expense 1,600 Accumulated Depreciation 1,600
______ 6. Supplies 1,200 Cash 1,200
______ 7. Supplies Expense 400 Supplies 400
______ 8. Cash 2,000 Unearned Service Fees 2,000
______ 9. Unearned Service Fees 1,000 Service Fees Earned 1,000
______ 10. Salaries Expense 800 Salaries Payable 800
______ 11. Salaries Payable 800 Cash 800
______ 12. Accounts Receivable 600 Service Fees Earned 600

PROBLEM 3-2C
Gary Company follows the practice of recording prepaid expenses and unearned revenues in balance sheet accounts. Gary’s annual