All tools or machines undergo wear and tear over time. a debit to Insurance Expense and a credit to Prepaid Insurance. Allowance for doubtful accounts on 1/1/07 was $50,000. On the statement of financial position it is shown as a reduction against the cost of non-current assets: Illustration 2 – Accounting for depreciation. Services were performed to satisfy $800 of unearned service revenue. b. D) Unearned Rent . Less-Accumulated Depreciation 70 $8330. The end-of-period spreadsheet (work sheet) for the current year for Jamal Company shows Balance … A) Depreciation Expense and Accumulated Depreciation?Equipment. 6. c. transferring journal entries to ledger accounts. False. And this process will be carry on till the life of asset. 20. 0 Step 2: Determine what the current account balance should equal. Balance sheet column 5. This entry will add the current year depreciation expense with the previous year closing balance. Balance sheet column 7. a debit to Prepaid Insurance and a credit to Accumulated Depreciation. Santa runs a large toy shop in Windsor. During the closing process, Accumulated Depreciation, Equipment will A. be closed to the income summary account. a. The entry also increases Accumulated Depreciation, which is the use of the asset and appears on the balance sheet under the Vehicles asset line. The equipment had an original cost of $50,000 and was 1/2 depreciated when sold. Supplies 8. True. True. Income statement column 4. The trial balance prepared after all the closing entries have been posted is called a pre-closing trial balance. You are to prepare the missing adjusting entry. The January 31 entry to record depreciation expense would include . 3. The correct sequence of steps in the accounting cycle is to prepare the A. d. recording entries in a journal. Question: The President Of Price Company Has Asked You To Close The Books (prepare And Process The Closing Entries). Step 3: Record the December 31 adjusting entry to get from step 1 to step 2. c. The company has only one fixed asset (equipment) that it purchased at the start of this year. $0 During the closing process, what amount was transferred from the income summary account to the Capital account in the third closing entry (i.e., after revenue and expense accounts have been closed to Income Summary)? On the work sheet, Accumulated Depreciation, Equipment would be recorded in which of the following columns? Balance sheet column 3. Prepare closing entries and post. Cash c. Accounts Payable d. Office Supplies QUESTION 22 After the accounts are closed and the journal entries have been posted, which of the following accounts would have a balance? Accounting for depreciation to date of disposal When selling or otherwise disposing of a plant asset, a firm must record the depreciation up to the date of sale or disposal. A. . $48,800 What is the balance in the Capital account? Depreciation C. Accretion B. You can generate several fixed asset accounts to accommodate equipment, machinery, land, and vehicles. The Vehicle asset line always shows the value of the asset at the time of purchase. b. adding a column of figures. Required: After The Closing Process Has Been Completed, Answer The Following Questions: What Is The Balance In The Supplies Expense Account? 30. Income statement column 6. Liquidation D. Hypothecation 6. Now there will be an adjusting entry if the depreciation expense is charges less or more from due to any reason. $73,010 account? Chapter – 6 During the closing process, Accumulated Depreciation, Equipment will be closed to the drawing account. reflects all depreciation to date. a. preparing a chart of accounts. The books are closed annually on December 31. 62. Accumulated Depreciation—Equipment : 14,000 Loss from Disposal of Plant Asset : 3,000 Equipment 45,000: To record the sale of equipment at a price less than book value. 5. False. 31. Question 1 Cee Enterprise is in the process of closing its account for the year ended 31 December 2019. The goal is to make the posted balance of the retained earnings account match what we reported on the statement of retained earnings and start the next period with a zero balance for all temporary accounts. The following accounts were taken from the Adjusted Trial Balance columns of the work sheet: Accumulated Depreciation. The equipment was sold for $25,000. Depreciation. Depreciation on equipment for the month is $320. Income Statement, Debit c. Balance Sheet, Debit d. Income Statement, Credit C) Accumulated Depreciation. b. $0 What Is The Balance In The Retained Earnings Account? The closing entry will credit Supplies Expense, Depreciation Expense–Equipment, Salaries Expense, and Utility Expense, and debit Income Summary. False. False. The accumulated depreciation account is closed to the income summary account. These balances in post-closing T-accounts are transferred over to either the debit or credit column on the post-closing trial balance. B) … The accumulated depreciation account is an asset account that shows the amount of depreciation for the current year only. During 2007, one piece of equipment was sold. The asset cost minus accumulated depreciation is known as the book value (or “net book value”) of the asset. Depreciation Expense. Recording asset depreciation in this way recognizes the use of assets in your business during the accounting period. Accumulated depreciation-equipment at 1/1/07 was $230,000. Presented below is the trial balance of the Crestwood Golf Club, Inc. as of December 31. Income statement column 159. B. . 63. Accumulated depreciation -Truck Step 1: Determine what the current account balance equals. a. The drawing account is closed to the income summary account. Fees earned 6. Accumulated Depreciation is a real account/balance sheet account. Company B is also selling its machine for $50,000, except they have not had it as long. Answer A. The process of preparing the post-closing trial balance is the same as you have done when preparing the unadjusted trial balance and adjusted trial balance. B. be closed to the capital account. a debit to Accumulated Depreciation and a credit to Prepaid Insurance. 3. Supplies Expense 1. The equipment had an original cost of $40,000 and was 3/4 depreciated when sold. If the depreciation is previously charge less from the original, then the entry should be. 14,700. During 201X, one piece of equipment was sold. Fees Earned. It has only accumulated $30,000 in depreciation. What is the balance in the rent revenue account? A. 1,300. 4. a debit to Insurance Expense and a credit to Accumulated Depreciation. It has the following information related to its non-current assets: Non-current assets Date acquired Cost Accumulated depreciation RM RM Machinery A 1 July 2016 25.000 9,375 Office equipment 1 April 2018 20,000 3,000 Depreciation on machineries is at the rate of 15% per annum on … Accumulated Depreciation account D. Income Summary 7. Unearned Fees 7. You need to monitor depreciation in your financial records as well. Each year when the accumulated depreciation journal entry is recorded, the accumulated depreciation account is increased. $0 During the closing a. a debit to Equipment for $500. Printing Plus has $100 of supplies expense, $75 of depreciation expense–equipment, $5,100 of salaries expense, and $300 of utility expense, each with a debit balance on the adjusted trial balance. By the end of the asset’s life, its cost has been fully depreciated and its net book value has been reduced to zero. Service Revenue b. Balance sheet column 8. This … Posting is the process of . The accumulated depreciation account is a statement of financial position account and as the name suggests is cumulative, i.e. True. Which one of the following accounts is both opened and closed during the closing process? Accumulated Depreciation 5. 6.2. Accumulated Depreciation—Equipment $40 Notes Payable 5,000 Accounts Payable 2,500 Unearned Service Revenue 800 Salaries and Wages Payable 1,200 Interest Payable 50 Common Stock 10,000 Retained Earnings 2,360 $21,950 $21,950 • Harper prepares the post-closing … Accumulated depreciation is the cumulative depreciation of an asset up to a single point in its life. At 12/31/07 the balance of the account was $270,000. C. be closed to the drawing account. Example #2. The preparation of a post-closing trial balance serves as a check on the accuracy of the closing process and ensures that the books are in balance at the start of the new accounting period. Powell Company had the following adjusted trial balance: Account Titles Credit Cash Debit $20.390 17.800 Accounts Receivable Supplies 7,690 44,900 Equipment $ 7,100 Accumulated Depreciation Accounts Payable Deferred Rent Revenue 4,000 1,950 36,630 21,900 Capital Stock Retained Earnings Dividends 16,000 Commission Revenue 50,400 5,200 Rent Revenue 6,100 Depreciation Expense … a. Cash account C. Owner’s Capital account B. Warton Company depreciates its equipment at the rate of $500 per month. At the end of the fiscal year, Accounts Receivable has a balance of $100,000 and Allowance for Doubtful Accounts has a balance of $7,000. Debit balance? 64 the closing process, accumulated depreciation and the $ 50,000, except have... Debit balance? 64 to satisfy $ 800 of unearned service revenue more from due to any.... 800 of unearned service revenue accounts were taken from the original, then the entry should be book... 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