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13 Cards in this Set
- Front
- Back
- 3rd side (hint)
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What is an adjusting entry? |
A transaction made after an initial trial balance. |
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What is the purpose of an adjusting entry? |
To bring an asset or liability account balance to proper amount. |
Balancing |
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What are the types of adjusting entries? |
1. Prepaid Expense 2. Unearned Revenue 3. Depreciation 4. Accrued Expense 5. Accrued Revenue |
Five items |
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What is a common prepaid expense? |
Insurance
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Cars and houses have these |
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What accounts are used to adjust a prepaid insurance expense?
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Debit: Insurance Expense Credit: Prepaid Insurance |
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What accounts are used to adjust a supplies expense? |
Debit: Supplies Expense Credit: Supplies |
Supplies are considered prepaid. |
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What category of accounts experience depreciation and what are the specific sub groups? |
Assets - Property, plant, and equipment - Intangible assets |
Examples: Building, copyright |
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What kind of specific items experience depreciation? |
- Land - Buildings - Machinery - Equipment - Vehicles - Copyright - Brandname |
Example: Tractor |
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What accounts are used to adjust an equipment depreciation? |
Debit: Depreciation expense, equipment Credit: Accumulated depreciation, equipment |
Very specific format!!! |
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What accounts are used to adjust an unearned revenue? |
Debit: Unearned (food) service revenue Credit: (Food) Service revenue |
Example: Food service |
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What accounts are used to adjust an accrued expense? |
Debit: Expense account Credit: Payable account or, with salary example, Debit: Salaries expense Credit: Salaries payable |
Example: Salaries |
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What accounts are used to adjust an accrued revenue for services? |
Debit: Accounts receivable Credit: (Food) Services revenue |
Example: food service |
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What accounts are used to adjust an accrued revenue for interest? |
Debit: Interest receivable Credit: Interest income |
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