Question

Prepare the adjusting journal entries for the following transactions. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)

1.
Supplies for office use were purchased during the year for $840, of which $270 remained on hand (unused) at year-end.

2.
Interest of $420 on a note receivable was earned at year-end, although collection of the interest is not due until the following year.

3.
At year-end, salaries and wages payable of $5,300 had not been recorded or paid.

4.
At year-end, one-half of a $3,700 advertising project had been completed for a client, but nothing had been billed or collected.

5.
Redeemed a gift card for $770 of services.

Answer 1

supplies expense 570 debit

supplies 570 credit

interest receivables 420 debit

interest revenue 420 credit

salaries expense 5,300 debit

salaries payable 5,300 credit

accounts receivables 3,700 debit

sales revenues 3,700 credit

accounts payable* 770 debit

gift card receivables 770 credit

Step-by-step explanation:

the difference between the purchased amount and ending will be the consumed supplies hence, expense:

purchases 840

ending (270)

consumed 570

the interest will be revenue as where accrued during this perod regardless of collection date

the wages and services revenues are accrued already thus, we recognize them

Gift card:

*redeem the gift card will reduce the amount due for the services.