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Week Three Problems and Exercises
ACC/290
University of Phoenix
BE4-1
cash
net income
A.
B.
C.
D.
E.
F.
-100
0
0
+800
-2,500
0
0
-20
+1,300
0
0
-600
P4-2A
Date
Accounts
Debit
Credit
1.
June 30
Accounts Rec.
3,900
3,900
2.
30
Unearned Service Rev.
4,100
4,100
3.
30
Insur. Exp.
240
240
4.
30
Utility Exp.
180
180
5.
30
Salary Exp.
1,250
1,250
6.
30
Depreciation Exp.
250
250
7.
30
Supply Exp.
1,280
1,280
Cash
6/30 …
6,850
Accounts Receivable
6/30 …
7,000
6/30
3,900
6/30 …
10,900
N/A
Supplies
6/30 …
2,000
6/30
1,280
6/30 …
720
Prepaid Insurance
6/30 …
2,880
6/30
240
6/30 …
2,640
Equipment
6/30 …
15,000
Accounts Pay.
6/30 …
4,230
6/30
180
6/30
4,410
Salary Pay.
6/30
1,250
6/30 …
1,250
Unearned Service Rev.
6/30
4,100
6/30 …
5,200
6/30 …
1,100
Common Stock
6/30 …
22,000
Salary Exp.
6/30 …
4,000
6/30
1,250
6/30 …
5,250
Rent Exp.
6/30 …
2,000
Insur. Exp.
6/30
240
6/30 Bal.
240
Utilities Exp.
6/30
180
6/30 …
180
Supply Exp.
6/30
1,280
6/30 …
1,280
Accumulated Depreciation
6/30
250
6/30 …
250
Depreciation Exp.
6/30
250
6/30 …
250
Service Rev.
6/30 …
8,300
6/30
4,100
6/30
3,900
6/30 …
16,300
Vogel Consult.
Adjusted Trial Balance
Debit
Credit
Accounts Rec.
Cash
Prepaid Insur.
Supplies
Equipment
Accumulated Depreciation
Accounts Pay.
Salary Pay.
Unearned Serv. Rev.
Common Stock
Service Rev.
Salary Exp.
Rent Exp.
Depreciation Exp.
Insur. Exp.
Utilities Exp.
Supply Exp.
10,900
6,850
2,640
720
15,000
5,250
2,000
250
240
180
1,280
$45,310
250
4,410
1,250
1,100
22,000
16,300
$45,310
P4-3A
Cash
5/31 …
2,500
Prepaid Insur.
5/31 …
1,800
5/31
450
5/31 …
1,350
Supplies
5/31 …
2,600
5/31
1,550
5/31 …
1,050
Land
5/31 …
15,000
Mortgage Pay.
Building
5/31 …
70,000
Accumulated Depreciation
5/31
300
5/31 …
300
Equipment
5/31 …
16,800
Accumulated Depreciation
5/31
250
5/31 …
250
Accounts Pay.
5/31 …
4,700
Unearned Rent Rev.
5/31
2,500
5/31 …
3,300
5/31 …
800
Salary Pay.
5/31
900
5/31 …
900
Interest Pay.
5/31
180
5/31 …
180
5/31 …
36,000
Common Stock
5/31 …
60,000
Rent Revenue
5/31 …
9,000
5/31
2,500
5/31 …
11,500
Salary Exp.
5/31 …
3,000
5/31
900
5/31 …
3,900
Utilities Exp.
5/31 …
800
Advertising Exp.
5/31 …
500
Interest Exp.
5/31
180
5/31 …
180
Insurance Exp.
5/31
450
5/31 …
450
Supplies Exp.
5/31
1,550
5/31 …
1,550
Depreciation Exp.
5/31
300
5/31
250
5/31 …
550
Vang Hotel
Adjusted Trial Balance
Debit
Credit
Cash
Prepaid Insurance
Supplies
Land
Building
Accumulated Depreciation
Equipment
Accumulated Depreciation
Accounts Payable
Unearned Rent Revenue
Salary Payable
Interest Payable
Mortgage Payable
Common Stock
Rent Revenue
Salary Expense
Utilities Expense
Advertising Expense
Interest Expense
Insurance Expense
Supplies Expense
Depreciation Expense
2,500
1,350
1,050
15,000
70,000
16,800
3,900
800
500
180
450
1,550
550
$114,630
300
250
4,700
800
900
180
36,000
60,000
11,500
$114,630
Vang Hotel
Income Statement
Rent revenue
11,500
Salary expense
3,900
Supply expense
1,550
Utilities expense
800
Depreciation expense
550
Advertising expense
500
Insurance expense
450
Interest expense
180
Total expenses
7,930
Net income
3,570
Vang Hotel
Retained Earnings Statement
Retained earnings, May 1
0
Net income
3,570
Retained earnings, May 31
$3,570
Vang Hotel
Balance Sheet
Cash
2,500
Supplies
1,050
Prepaid insurance
1,350
Current assets
4,900
Land
15,000
Building
70,000
300
69,700
Equipment
16,800
250 16,550 101,250
Total assets
106,150
Accounts payable
4,700
Salaries and wages payable
900
Unearned rent revenue
800
Interest payable
180
Total current liabilities
6,580
Mortgage payable
36,000
Total liabilities
42,580
Common stock
60,000
Retained earnings
3,570
Total equity shareholders’
63,570
Total liabilities and equity shareholders’
106,150
Accounts closed:
Rent revenue, salary expense, utilities expense, advertising
expense, interest expense, insurance expense, supply expense,
and depreciation expense.
Answer the following summary question: Commercial
accounting and generally accepted accounting principles,
generally prescribe the accrual basis of accounting over the cash
basis. Describe both bases of accounting and explain the
differences.
Accrual accounting is where revenues are recognized when they
are earned, not when they are received. In accrual accounting,
cash does not need to change hands before the revenue is
recognized. Under the cash basis method of accounting, income
is not counted until cash is actually received, and expenses are
not counted until they are actually paid.
1. May 31 Insur. Exp. 450
450
2. 31 Supplies Exp. 1,550
1,550
3. 31 Depreciation Exp. 300
300
31 Depreciation Exp. 250
250
4. 31 Interest Exp. 180
180
5. 31 Unearned Rent Rev. 2,500
2,500
6. 31 Salary Exp. 900
900
Week Three Problems and ExercisesACC290University of Phoeni.docx

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