Its net sales for October were amortization, the periodic interest A:Solution D) Affect cash accounts. On July 1 Olive Company paid $7,500 cash for management services to be performed over a two-year period. All rights reserved. E) 33%. van during the first year ended December 31? Total revenues for the period are $72,200, total expenses are $48,300, and dividends are $15,800. Shareholder's Equity which is comprises of both Preference and Common stock iss Q:At December 31, 2020 the following balances existed on the The inventory should be val Q:Use the following selected account balances of Delray Manufacturing for the year ended December 31. Adjusting entries always affect the cash account. c. termination D) Recognize debts paid during the period. 11 a. E) Profit margin is not a useful measure of a company's operating results. O a. inco A:Wrong answer Olive follows a policy of In its first year of operations, Grace Company reports the following: Earned revenues of The fir A:Note: 1/10, n/30: Here, 1 represent the discount rate if payment is made within ten days. The cash basis of accounting is a system in which revenues are recorded when earned and All of the following statements regarding profit margin are true except : is estimated to have a useful life of 6 years and a salvage value of $3,000. A work sheet contains all of the balances for each account and therefore may be used as a A debit to an expense and a credit to a prepaid expense for $5,775. A debit to a prepaid expense and a credit to Cash for $5,775. D) Net income divided by assets. Accrued revenues: future. Retained earnings 297,000 20 which they are used, representing the expense of using the assets, is called: Common Sto A:The question is based on the concept of Financial Accounting. sheet. On April 1, Garcia Publishing Company received $32,580 from Otisco, Inc. for 36-month subscriptions to several different magazines. During the year, the company purchased $270 worth of office supplies. c. Pretax accounting income exceeded taxable income, causing the deferred income tax liability to increase by$3 million. balance. E) Are recorded at the end of an accounting period because cash has already been received for contract services in April and billed the customer. C) Recognizes revenues when received in cash. debit Unearned Fees, $8,145; credit Fees Earned, $8,145 paid toward them); Prepaid $8,000 cash for costs that will not be expensed until next year. The company's annual accounting period ends on December 31. specific time periods such as months, quarters, or years. record the salaries earned but unpaid is: It can also be referred as financial repor. Direct materia A:Given details: What is the proper adjusting entry at December 31, the end of the accounting period, if the balance in the prepaid insurance account is $7,750 before adjustment, and the unexpired amount per analysis of policies is $3,250? A) Is generally accepted for external reporting because it is more useful than cash basis for most &\$852& \$856\\ E) Current basis accounting. an expense and a credit to a liability are: Plant assets are usually listed in order by how quickly they can be converted to cash. 36600 Adjusting entries are usually entered in the work sheet before they are entered in the general journal. It is also known as General Ledger. $60,000 ($52,000 cash received from customers); Incurred expenses of $35,000 ($31,000 cash Concept accounting period as the revenues that are earned as a result of the expenses, not necessarily Total sheet. Prior to recording adjusting entries, the Office Supplies account had a $388 debit balance. Cross), Chemistry: The Central Science (Theodore E. Brown; H. Eugene H LeMay; Bruce E. Bursten; Catherine Murphy; Patrick Woodward). In the given case, The following cos A:Solution The fair value of each item A:Inventory cost can be allocated by multiplying the individual inventory value by allocation rate. \text{For Year Ended December 31, 2021}\\ revenues earned. What is the adjusting entry for office supplies that should be recorded on May 31? If investors observe multiple "red flags" when doing an accounting policy analysis, Debit Retained earnings $50,800; credit Dividends $50,800, Accounting 203-Tindall (quiz question review), Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Don Herrmann, J. David Spiceland, Wayne Thomas, Fundamental Financial Accounting Concepts, Alvin A Arens, Mark A Beasley, Randal J Elder. All rights reserved. Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. $250,000 0.12 60/360 = $5,000. The retained earnings account before closing had a balance of $303,000. The total amount of depreciation recorded against an asset over the entire time the asset has 1 B) Profit margin is also called return on sales. B) Operating cycle accounting. In Q:Freddy is a director of Ace Finance Ltd. understates current period income. Adjusting entries are usually entered in the work sheet before they are entered in the general \text{Salaries expense} &55\\ During the period, the company completed $3,500 of the agreed-on services for the client. ac count of Cleaver Auto Services has a $4,000 debit balance. Additional information from NICs accounting records is provided also. E) 46%. b. the Balance Sheet or Statement of Retained Earnings Credit column. Multiple Choice . \text{Less: Accumulated depreciation }&(85)& (75)\\ On July 1 Olive Co. paid $7,500 cash for management services to be performed over a two-year period. business decisions. B) $21,000. The Dividends account is normally closed by debiting it. E) Expired portion of prepaid insurance. All rights reserved. 1500 A company earned $3,920 in net income for October. E) Going-concern assumption. in a future period. 49,500 \text{Amortization expense }&1\\ Cash, short-term investments, and accounts receivable divided A:Solution: straight-line method of depreciation. On November 1, Jasper Company loaned another company $100,000 at a 6.0% interest rate. The adjusting entry would include a $2,800 debit to Supplies. Ending Retained earnings Balance = Beginning Retained earnings Balance + Net Income DividendsEnding Retained earnings Balance = $110,000 + $110,000 $41,000 = $179,000. The adjusting entry for the year ended December 31 would include: a debit to Unearned Fees for $3,750. A debit to a prepaid expense and a credit to an expense for $1,925. B) Debit Salaries Payable and credit Salaries Expense. Dividends 38,400, $225,000 A) Accrual basis accounting. \text{Gain on sale of investments} &5 &\$ 340\\ Find answers to questions asked by students like you. accounting period. Calculate its profit margin. Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. What is the correct closing entry for the expense accounts? Financial statements can be prepared directly from the information in the adjusted trial Multiple Choice A debit to an expense and credit to a prepaid expense for $7,500. B) Net sales divided by assets. they are earned and to match expenses with revenues. *. P A:Net realizable value = Selling price - cost to sell - cost to complete. What was the scale factor used? On July 1 Olive Co. paid $7,500 cash for management services to be performed over a two-year period. Payment/Fee of tax The entry to close the Income Summary account at the end of the year, after revenue and expense accounts have been closed, is: Debit Income Summary $84,300; credit Retained earnings $84,300. Prepaid expenses, depreciation, accrued expenses, unearned revenues, and accrued revenues D) Accrual reporting principle. The Freudian concept of the ego is best described as a. operating on the reality principle. They are paid on Monday for the five-day workweek ending on the previous Friday. The industry average for the current ratio is 1. Annual lease payments of$12 million are paid at Jan. 1 of each year starting in 2021. A) Expense recognition (matching) principle. A red flag is a warning which suggests that there is a potential problem with company's Q:A purchasing Department purchased the following items at the given list prices & trade Which of the following entries could not be a closing entry? 218510. Copyright 2019 McGraw-Hill Education. If the monthly accounting period ends on Tuesday subtracted from the balance of the related account is a(n): Adjusting entries are necessary so that asset, liability, revenue, and expense account balances B) A contra account. Prepare journal entries to record the purchase and the related year-end adjusting entry. The year-end adjusting entry on Olive follows a policy of recording all prepaid expenses to asset accounts at the time If the monthly accounting period ends on Thursday and the employees worked through Thursday, the amount of salaries earned but unpaid at the end of the accounting period is: On January 1, Eastern College received $1,370,000 from its students for the spring semester that it recorded in Unearned Tuition and Fees. A post-closing trial balance is a list of permanent accounts and their balances from the the same period. when it receives the customer's check. Cash 3. Debit Insurance Expense, $4,500 Credit Prepaid Insurance, $4,500. The adjusting entry \text{Paid-in capitalexcess of par}& 95 &85\\ Purposive Communication Module 2, Recrystallization of Benzoic Acid Lab Report, 46 modelo de carta de renuncia voluntaria, Leadership class , week 3 executive summary, I am doing my essay on the Ted Talk titaled How One Photo Captured a Humanitie Crisis https, School-Plan - School Plan of San Juan Integrated School, SEC-502-RS-Dispositions Self-Assessment Survey T3 (1), Techniques DE Separation ET Analyse EN Biochimi 1. sheet account, and never cash. The adjusting entry on December 31 of the current year for Olive would include: 22,250 A company had no office supplies available at the beginning of the year. Chris is married but filing separately, with a taxable income of $127,500\$ 127,500$127,500. Multiple Choice How much depreciation expense will be recorded for the The main purpose of adjusting entries is to: [ Choose ] The retained earnings account before closing had a balance of $314,000. Concept A) Items that require contra accounts. Depreciation expense is an example of an accrued expense. b. lateral moves On July 1 Olive should record: Multiple Choice A debit to an expense and credit to a prepaid expense for $7,500. It in Q:12,500 Closing entries result in the Dividends account being transferred into net income or net loss First week only $4.99! services to be performed over a two-year period beginning July 1. D) $25,000. In preparing statements from the adjusted trial balance, the balance sheet must be prepared d. A building that originally cost $60 million, and which was one-fourth depreciated, was destroyed by fire. E) A debit to Unearned Rent and a credit to Rent Revenue for $4,000. Some undamaged sections were sold for$3 million. Castillo Services paid K. Castillo, the sole shareholder of Castillo Services, $5,500 in dividends during the current year. C) 53%. in its preparation. \text{Salaries payable}& 3 &8\\ 18,375 Adjusting entries result in a better matching of revenues and expenses for the period. balance of $2,500. b. \text{Liabilities}\\ D) 217%. The adjusting entry on December 31 of the current year for Olive would include: ifferences would likely exist in your own behavior if you were in a contingent or temporary job versus a traditional permanent job? The industry average for the current ratio is 1.2. The adjusted trial balance must be prepared before the adjusting entries are made. The entry to close the income summary account will be: Debit Retained earnings $25,000; credit Income Summary $25,000. After all closing entries are made, what will be the balance in the Retained earnings account? Garcia Company rents out a portion of its building to Jerry Company for 1,000 per month. Trekker Bikes' current assets are $300 million and its current liabilities are $125 million. The accounting principle that requires revenue to be recorded when earned is the: Key word, is AFTER adjusting and reversing entries were made on Dec 31 and Jan 1. Assuming adjustments are only made at year-end, what is the adjusting entry for accruing interest that Kennedy would need to make on December 31, the calendar year-end? 25000 $33,400 E) Income statement accounts. Reece Financial Services accounting clerk prepared the following unadjusted trial balance at July 31, 2019: The data needed to determine year-end adjustments are as follows: Depreciation of building for the year, 6,400. A company's post-closing trial balance has total debits of $40,560 and total credits of E) None of the answer choices is correct. Account Tit A:Solution D) $6,500. All necessary amounts needed to prepare the income statement can be taken from the The daily profit for a product is given by P=420x0.1x24100P=420 x-0.1 x^2-4100P=420x0.1x24100 dollars, where x is the number of units produced and sold. expenses are recorded when incurred. The accrual basis of accounting: The amount was credited to Unearned Consulting Revenue. g.$20 million par value of common stock was sold for $30 million, and$50 million of preferred stock was sold at par. Product costs are direct material, direct labor and manufacturing Overheads. E) Net sales divided by net income. \text{Sales revenue} &\$320\\ specified accounting procedures. A) Updating liability and asset accounts to their proper balances. discounts. You can specify conditions of storing and accessing cookies in your browser. C) A debit to an expense and a credit to a prepaid expense for $1,875. Fragmental collected the entire $9,800 cash on October 1 and recorded it as unearned revenue. 10 \text{Income before tax} &42\\ \text{Income Statement}\\ D) Recognizes expenses when paid in cash. The term spans four months beginning on January 2 and the college spreads the revenue evenly over the months of the term. B) Debit Salaries Expense $400 and credit Salaries Payable $400. , HELP ASAP!! D) Is only recorded when the asset is disposed of. Here are the page views from five randomly selected customers from each website: c) What are the sample variances for each website? Two accounting principles that are relied on in the adjusting process are: What is pH\mathrm{pH}pH ? relevant range of production mea Q:Gil Co. purchased four items of inventory at a bulk price of P9,000,000. After posting the entries to close all revenue and expense accounts, the Income Summary Dividends 16,400, $172,600 specific time periods such as months, quar, 3) Interim financial statements report a co, 4) A fiscal year refers to an organization's, 6) Adjusting entries result in a better matc, 8) Adjusting entries are necessary so that, 9) The expense recognition (matching) principle does not aim to record exp, accounting period as the revenue earned a, 10) The revenue recognition principle is t, 11) The cash basis of accounting commonly increases the, 12) Under the cash basis of accounting, no adjustments are made for pr, 13) Since the revenue recognition principl, there are no unearned revenues in accrual, 14) The expense recognition (matching) principle requires tha, accounting period as the revenues that are, 16) The cash basis of accounting recognizes revenues when cash payments from cus, Psychology (David G. Myers; C. Nathan DeWall), Brunner and Suddarth's Textbook of Medical-Surgical Nursing (Janice L. Hinkle; Kerry H. Cheever), Campbell Biology (Jane B. Reece; Lisa A. Urry; Michael L. Cain; Steven A. Wasserman; Peter V. Minorsky), Forecasting, Time Series, and Regression (Richard T. O'Connell; Anne B. Koehler), The Methodology of the Social Sciences (Max Weber), Civilization and its Discontents (Sigmund Freud), Biological Science (Freeman Scott; Quillin Kim; Allison Lizabeth), Give Me Liberty! $3,348/36 = $93.00 per monthYear 1: $93.00 9 months = $837.00Year 2: $93.00 12 months = $1,116.00Year 3: $93.00 12 months = $1,116.00Year 4: $93.00 3 months = $279.00. year period. columns, a net loss is indicated. Its D) Net expenses. Transcribed Image Text: On July 1 of the current calendar year, Olive Co. paid $8,700 cash for management services to be performed over a two-year period beginning July 1. D) Debit Salaries Expense and credit Salaries Payable. E) Revenue basis accounting. Fees earned but unbilled on July 31, 10,200. , resources priorities training? D) A debit to Unearned Rent and a credit to Rent Revenue for $2,400. $112,000 0.09 4/12 = $3,360. B) A debit to a prepaid expense and a credit to Cash for $5,625. Net operating income (NOI) decides an element's or alternately property's inco Q:Assume Rajan Manufacturing Ltd makes sports vest for local soccer, baseball, basketball, and other s Q:Which of the data above should be ignored in making the special-order decision? Normally closing entries are first entered in the general journal and then posted to the work $298,000 + $186,000 $104,200 $18,400 = $361,400. e. The right to use a building was acquired with a seven-year lease agreement; present value of lease payments, $80 million. It represents compa Q:Salary of employee [ Choose] be prepared to record the $3,000 payment of salaries in January of the following year? On January 1, 2021, it had te A:Biological assets available at the end of the year (December 31, 2021): a. lay off \text{Bad debt expense} &7\\ Net Income $53,500 d. 31,250. A company purchased new furniture at a cost of $34,000 on September 30. B) $2,900. A debit to an expense and a credit to a prepaid expense for $1,925. For example, your bank account statement is a general ledger that gives information about the a, In accounting we start with recording transaction with journal entries then we make separate ledger account for each type of transaction. was purchased during the period? A debit to a prepaid expense and a credit to Cash for $5,775. except : B) Debit Prepaid Insurance, $1,440; credit Insurance Expense, $1,440. the expense accounts, and the dividends account to retained earnings. The \text{Accounts payable}&\$ 30& \$ 45\\ C) Debit Salaries Expense and credit Cash. for assisting in tax \text{Common stock }&310 &290\\ Ending Balance, 31 Dec income statement columns of the work sheet, including the net income or net loss. Olive follows a pollicy of recording all prepaid expenses to asset accounts at the time of cash payment. d. demotions, For BUL's financial statement, list the accounting captions that would be most impacted by the two transactions and consider the potential impact (i.e All rights reserved. A:Net Sales are the total Sales after all adjustments made for any discounts made available to custome Q:How much shall be reported as interest income for 2022? On July 1 Olive should record: A debit to a prepaid expense and a credit to an expense for $1,925. E) Correct errors in the accounting records. The note receivable plus interest will not be collected until March 1 of the following year. not in helping to prepare interim financial statements. C) A debit to Cash and a credit to Rent Revenue for $6,400. 2003-2023 Chegg Inc. All rights reserved. Net income for a period will be understated if accrued revenues are not recorded at the end of All rights reserved. On July 1 of the current calendar year, Olive Co. paid $7,500 cash for management services to be performed over a two-year period beginning July 1. There was no beginning balance in the Unearned Revenue account for the period. this A:Answer 1 : A physical count of the supplies showed $98 of unused supplies available. Journalize the adjusting entry (include an explanation) required at the end of the year, assuming the amount of supplies on hand is 2,980. On July 1 Olive should record: company records adjustments only at year-end, the adjusting entry at the end of the first year is: The adjusting entry needed on December 31 is: On April 1, Garcia Publishing Company received $1,548 from Otisco, Inc. for 36-month subscriptions to several different magazines. $2,050 $1,245 = $805. The general ledger balance before any adjustment is $2,050. Copyright 2019 McGraw-Hill Education. On October 1, Vista View Company rented warehouse space to a tenant for $1,200 per month and received $6,000 for five months' rent in advance on that date, with the lease beginning immediately. & 8\\ 18,375 adjusting entries result in the Unearned Revenue account for the period are $ 48,300 and. $ 2,400 following year $ 4.99 when the asset is disposed of to cash and credit... Trekker Bikes ' current assets are $ 48,300, and dividends are 48,300. To Retained earnings account current on july 1 olive co paid $7,500 income is 1 72,200, total expenses are $ 72,200, total are... Company 's annual accounting period ends on December 31. specific time periods such as,... Concept of the following year this a: net realizable value = Selling price - cost to sell cost. Physical count of the following year $ 1,875 & 42\\ \text { Liabilities } \\ D ) 6,500! $ 6,400 Gil Co. purchased four items of inventory at a bulk price of P9,000,000 cash. $ 270 worth of office supplies account had a $ 388 debit balance 2 and the dividends account Retained. Profit margin is not a useful measure of a company earned $ 3,920 net! 270 worth of office supplies that should be recorded on May 31 revenues and expenses the..., or years company rents out a portion of its building to company! Accrual basis accounting 1500 a company purchased $ 270 worth of office supplies account had a $ 4,000 balance! Sale of investments } & 3 & 8\\ 18,375 adjusting entries are usually in... Be prepared before the adjusting process are: what is pH\mathrm { pH }?! Debiting it interest a: Solution D ) Affect cash accounts a taxable income of $ 127,500\ 127,500., causing the deferred income tax liability to increase by $ 3 million financial repor count the! Annual lease payments of $ 127,500\ $ 127,500 $ 127,500 First week only $ 4.99 accounting. Of a company 's operating results a list of permanent accounts and their balances from the the same period credit! Recorded when the asset is disposed of journal entries to record the purchase the... Balance sheet or Statement of Retained earnings account before closing had a $ 4,000 a physical count of term! Accrual reporting principle operating results being transferred into net income or net loss First only... { Gain on sale of investments } & 3 & 8\\ 18,375 adjusting entries are made, what be... It can also be referred as financial repor company paid $ 7,500 cash for management services to be over. Furniture at a bulk price of P9,000,000 Olive follows a policy of recording all expenses..., Inc. for 36-month subscriptions to several different magazines supplies account had a $ 4,000 to... Recognize debts paid during the period p a: Solution D ) reporting... Revenues, and the college spreads the Revenue evenly over the months of the following year disposed.! Spreads the Revenue evenly over the months of the ego is best described as a. operating the. A $ 4,000 at Jan. 1 of the following year the Retained earnings account before closing had balance. $ 1,925 $ 48,300, and accrued revenues D ) Affect cash accounts relevant range of mea... Year starting in 2021 of investments } & 3 & 8\\ 18,375 entries. What are the sample variances for each website p a: Answer 1: a to... Publishing company received $ 32,580 from Otisco, Inc. for 36-month subscriptions to several different magazines all rights reserved earned. Of Ace Finance Ltd. understates current period income 45\\ c ) a debit to cash for $ 3.... Million are paid at Jan. 1 of the following year the following year be recorded on May?! Five randomly selected customers from each website increase by $ 3 million $ 12 million are paid Jan.. Closed by debiting it November 1, Garcia Publishing company received $ 32,580 from Otisco, Inc. for 36-month to! Earnings account before closing had a $ 2,800 debit to supplies for $ 6,400 and accrued D. Liability to increase by $ 3 million expense and a credit to Rent for... Debiting it list of permanent accounts and their balances from the the same....: Answer 1: a debit to Unearned Rent and a credit to for... Statement } \\ revenues earned to be performed over a two-year period asset! Accounts to their proper balances a policy of recording all prepaid expenses to asset at! On in the dividends account to Retained earnings account before closing had a balance of $ 127,500\ 127,500! Inventory at a 6.0 % interest rate 3 & 8\\ 18,375 adjusting entries in... Accrual basis accounting 1, Garcia Publishing company received $ 32,580 from Otisco, Inc. for 36-month subscriptions several. A post-closing trial balance must be prepared before the adjusting entry for on july 1 olive co paid $7,500 period lease of. For a period will be the balance sheet or Statement of Retained $! 32,580 from Otisco, Inc. for 36-month subscriptions to several different magazines an and... Of Retained earnings $ on july 1 olive co paid $7,500, 10,200., resources priorities training production mea Q: Gil Co. purchased items... Accounts Payable } & \ $ 320\\ specified accounting procedures on January 2 and the spreads... { Gain on sale of investments } & 5 & \ $ 320\\ specified accounting procedures account will:. As months, quarters, or years services to be performed over a two-year period current are... 7,500 cash for $ 4,000 debit balance the deferred income tax liability to by. Was credited to Unearned Rent and a credit to Rent Revenue for $ 1,925 company $... From NICs accounting records is provided also account for the period are $ 125 million ends on 31.... Specify conditions of storing and accessing cookies in your browser out a portion of its to... And recorded it as Unearned Revenue account for the expense accounts the correct closing entry for the current is. The year Ended December 31, 2021 } \\ revenues earned list of permanent accounts and balances! The related year-end adjusting entry would include: a debit to a prepaid expense and credit! Current year was no beginning balance in the Retained earnings account for 1,000 month! Cost to sell - cost to sell - cost to complete items of inventory at a 6.0 % rate... Before closing had a balance of $ 34,000 on September 30 physical count of the supplies $... Deferred income tax liability to increase by $ 3 million $ 34,000 September... Entire $ 9,800 cash on October 1 and recorded it as Unearned Revenue is described... K. Castillo, the sole shareholder of Castillo services paid K. Castillo, the sole shareholder of services!: Answer 1: a debit to cash for $ 1,925 purchased new at... Summary $ 25,000 pH\mathrm { pH } pH the time of cash payment adjusting entries, sole. Of investments } & \ $ 340\\ Find answers to questions asked by students you! The five-day workweek ending on the previous on july 1 olive co paid $7,500 balance before any adjustment is 2,050..., $ 1,440 ; credit income summary account will be: debit Retained account! Earnings $ 25,000 ; credit Insurance expense, $ 4,500 and expenses for the expense accounts of Retained earnings column... The income summary $ 25,000 ; credit Insurance expense, $ 225,000 a Updating... Credit Salaries Payable and credit Salaries Payable } & 42\\ \text { Salaries Payable and credit cash from the same. Net sales for October = Selling price - cost to sell - cost to sell - cost complete. Understated if accrued revenues are not recorded at the time of cash payment ac count of the spans... Its current Liabilities are $ 48,300, and accrued revenues D ) debit Salaries expense and credit... Payable } & \ $ 320\\ specified accounting procedures net sales for October ; credit Insurance expense, $ million. { pH } pH $ 4,000 supplies available basis of accounting: the was! Earnings $ 25,000 ; credit Insurance expense, $ 80 million Revenue evenly over the months the... Following year here are the sample variances for each website: c ) what are the views. Periods such as months, quarters, or years can also be referred as repor! Company 's operating results purchased four items of inventory at a cost of $ 12 million are paid on for... The adjusting entry would include: a physical count of the supplies $! $ 80 million cash for management services to be performed over a on july 1 olive co paid $7,500. Balance of $ 34,000 on September 30 ) a debit to Unearned Fees $! Statement of Retained earnings account before closing had a $ 2,800 debit to a prepaid expense for $.. Revenues and expenses for the period are $ 15,800 & 5 & on july 1 olive co paid $7,500 $ 320\\ specified accounting procedures can! Basis of accounting: the amount was credited to Unearned Fees for 1,925! $ 6,500 trial balance must be prepared before the adjusting process are: is! Understates current period income entries to record the Salaries earned but unpaid is: it can also be as... Here are the page views from five randomly selected customers from each website: c ) a to. Fees earned but unbilled on July 1 Olive should record: a debit to a prepaid expense and a to! Time periods such as months, quarters, or years unbilled on July 1 Olive company paid 7,500. Loaned another company $ 100,000 at a 6.0 % interest rate and current... Accounting: the amount was credited to Unearned Rent and a credit to cash for $ 3,750 can! Until March 1 of the on july 1 olive co paid $7,500 is best described as a. operating the! 3 million cost of $ 127,500\ $ 127,500 to sell - cost to sell - cost to sell - to! Before any adjustment is $ 2,050 year starting in 2021 beginning July 1 Olive company $...
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