Zheng had the following selected transactions in the month of March. The company adjusts its accounts monthly.
1. The company has an 8%, $12,000 note payable due in one year. Interest is payable the first of each month. It was last paid on March 1, and will be paid next on April 1.
2. At the end of March, the company earned $250 interest on its investments. The bank deposited this amount in Zheng’s bank account on April 1.
3. Zheng has five employees who each earn $200 a day. Salaries are normally paid on Fridays for work completed Monday through Friday of the same week. Salaries were last paid on Friday, March 27, and will be paid next on Friday, April 3.
4. At the end of March, the company owed the utility company $550 and the telephone company $200 for services received during the month. These bills were paid on April 10.
5. At the end of March, Zheng has earned $3,000 that it has not yet billed. It bills its clients for fees earned on April 1. On April 30, it collects $2,000 of this amount due.
Instructions
(a) For each of the above situations, prepare the monthly adjusting journal entry required at March 31.
(b) Prepare any subsequent transaction entries that occur in the month of April.
Enjoy 24/7 customer support for any queries or concerns you have.
Phone: +1 213 3772458
Email: support@gradeessays.com