Asked by julie
A review of the ledger of Terrell Company at December 31, 2012, produces these data pertaining to the preparation of annual adjusting entries.
1. Prepaid Insurance $18,279. The company has separate insurance policies on its buildings and its motor vehicles. Policy B4564 on the building was purchased on July 1, 2011, for $11,610. The policy has a term of 3 years. Policy A2958 on the vehicles was purchased on January 1, 2012, for $8,604. This policy has a term of 18 months.
2. Unearned Sales Revenue $27,168: The company began selling magazine subscriptions on October 1, 2012, on an annual basis. The selling price of a subscription is $24. A review of subscription contracts reveals the following.
Subscription Start Date
Number of Subscriptions
October 1 250
November 1 312
December 1
570
1,132
3. Notes Payable, $46,400: This balance consists of a note for 6 months at an annual interest rate of 7%, dated October 1.
4. Salaries Payable $0: There are 12 salaried employees. Salaries are paid every Friday for the current week. 5 employees receive a salary of $630 each per week, and 7 employees earn $740 each per week. Assume December 31 is a Wednesday. Employees do not work weekends. All employees worked the last 3 days of December.
Calculate the following amounts.
1. Insurance expense
2. Sales revenue
3. Interest expense
4. Salaries and wages expense
1. Prepaid Insurance $18,279. The company has separate insurance policies on its buildings and its motor vehicles. Policy B4564 on the building was purchased on July 1, 2011, for $11,610. The policy has a term of 3 years. Policy A2958 on the vehicles was purchased on January 1, 2012, for $8,604. This policy has a term of 18 months.
2. Unearned Sales Revenue $27,168: The company began selling magazine subscriptions on October 1, 2012, on an annual basis. The selling price of a subscription is $24. A review of subscription contracts reveals the following.
Subscription Start Date
Number of Subscriptions
October 1 250
November 1 312
December 1
570
1,132
3. Notes Payable, $46,400: This balance consists of a note for 6 months at an annual interest rate of 7%, dated October 1.
4. Salaries Payable $0: There are 12 salaried employees. Salaries are paid every Friday for the current week. 5 employees receive a salary of $630 each per week, and 7 employees earn $740 each per week. Assume December 31 is a Wednesday. Employees do not work weekends. All employees worked the last 3 days of December.
Calculate the following amounts.
1. Insurance expense
2. Sales revenue
3. Interest expense
4. Salaries and wages expense
Answers
Submit Your Answer
We prioritize human answers over AI answers.
If you are human, and you can answer this question, please submit your answer.