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    ACC 1100 Day 06&07 Columbia Example

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    Mai Anh Đào
    Columbia Flying Service provided the unadjusted trial balance and additional information needed to prepare adjusting entries for the year ending December 31, 2020. Adjusting entries needed to be made for accrued salaries, deferred revenue recognized, depreciation on planes and equipment, accrued rent, prepaid insurance allocation, accrued interest on notes payable, inventory count adjustment, accrued revenue on charter flight, and estimated income tax expense. The adjusted trial balance and financial statements including income statement, balance sheet, and statement of retained earnings were required to be prepared.

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    ACC 1100 Day 06&07 Columbia Example

    Uploaded by

    Mai Anh Đào
    59 views2 pages
    Columbia Flying Service provided the unadjusted trial balance and additional information needed to prepare adjusting entries for the year ending December 31, 2020. Adjusting entries needed to be made for accrued salaries, deferred revenue recognized, depreciation on planes and equipment, accrued rent, prepaid insurance allocation, accrued interest on notes payable, inventory count adjustment, accrued revenue on charter flight, and estimated income tax expense. The adjusted trial balance and financial statements including income statement, balance sheet, and statement of retained earnings were required to be prepared.

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    Columbia Flying Service provided the unadjusted trial balance and additional information needed to prepare adjusting entries for the year ending December 31, 2020. Adjusting entries needed to be made for accrued salaries, deferred revenue recognized, depreciation on planes and equipment, accrued rent, prepaid insurance allocation, accrued interest on notes payable, inventory count adjustment, accrued revenue on charter flight, and estimated income tax expense. The adjusted trial balance and financial statements including income statement, balance sheet, and statement of retained earnings were required to be prepared.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    59 views2 pages

    ACC 1100 Day 06&07 Columbia Example

    Uploaded by

    Mai Anh Đào
    Columbia Flying Service provided the unadjusted trial balance and additional information needed to prepare adjusting entries for the year ending December 31, 2020. Adjusting entries needed to be made for accrued salaries, deferred revenue recognized, depreciation on planes and equipment, accrued rent, prepaid insurance allocation, accrued interest on notes payable, inventory count adjustment, accrued revenue on charter flight, and estimated income tax expense. The adjusted trial balance and financial statements including income statement, balance sheet, and statement of retained earnings were required to be prepared.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
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    of 2

    ACC 1100 Introductory Financial Accounting

    Days 6&7 Adjusting Entry


    Columbia Flying Service
    Unadjusted Trial Balance
    As at December 31, 2020
    Debit Credit
    Cash $61,500
    Accounts receivable 45,000
    Supplies inventory 2,000
    Equipment 42,000
    Equipment, accumulated depreciation $6,000
    Planes 216,000
    Planes, accumulated depreciation 71,000
    Prepaid insurance 34,000
    Accounts payable 8,000
    Deferred revenue (lessons) 28,000
    Notes payable 60,000
    Common shares 10,000
    Retained earnings 78,100
    Revenues from lessons 895,000
    Revenues from charters 156,000
    Salaries expense 623,000
    Fuel expense 189,000
    Maintenance expense 51,000
    Supplies expense 6,000
    Insurance expense 15,000
    Advertising expense 13,000
    Rent expense 11,000
    Interest expense 2,400
    Licences and fees 1,200
    $1,312,100 $1,312,100
    The following information is also available:

    1) Instructor salaries for the last week of December, 2020, have not yet been
    recorded. They will be payable the first week of the New Year. Salaries for the
    one week are $15,500.
    2) In the course of the last two weeks of December, 2020, lessons were given that
    had been paid for in advance (deferred revenue). The amount charged for the
    lessons was $16,500. No accounting recognition has yet been given for the
    service provided.
    3) No depreciation has been recorded in 2020. The useful life of the planes is
    estimated at 10 years (no salvage value) and that of the equipment at 7 years
    (also no salvage value).
    4) Rent for December, $1,000, has not yet been paid and recorded.
    5) The company purchases a one-year insurance policy each year which takes
    effect on July 1. The entire cost of the current year’s policy (July 1, 2020 to
    June 30, 2021) has been charged (debited) to “Prepaid insurance”. No entries
    to the “Insurance expense” have been made since July 1, 2020.
    6) Interest on the $60,000 note payable outstanding is payable twice each year,
    April 1 and October 1. The annual rate of interest is 8 percent. The note was
    issued on April 1, 2020. The amount of interest expense represents the first
    interest payment, which was made on October 1.
    7) All purchases of supplies are charged (debited) to “Supplies expense”. The
    balance in “Supplies inventory” represents supplies on hand at the beginning of
    the year. A physical count on December 31, 2020, indicated supplies currently
    on hand of $4,000.
    8) On December 29, the company flew a charter for which it has not yet billed the
    customer and which it has not yet recorded in the accounts. The customer will
    be charged $6,800.
    9) Based on preliminary computations, the firm estimates that income tax expense
    for year 2020 will be $22,000.

    Required

    a. Prepare all journal entries that would be necessary to adjust and bring the
    accounts up to date. (Add any additional account titles that you believe to be
    necessary.)
    b. Prepare all the financial statements except the statement of cash flows for
    the year ending December 31, 2020.

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