Blue Spruce, CPA, opened an accounting consulting practice on January 1, 2017. During the first month of operations, the following transaction occurred. 1. Performed services for customers with terms net 60. At January 31, $4450 of such services was performed but not yet billed to the insurance companies.
2. Utility expense incurred but not paid prior to January 31 totaled $1680.
3. Purchased computer and networking equipment on January 1 for $56000, paying $28000 in cash and signing a $ 28000, 3 year note payable. The equipment depreciates $1120 per month. Interest is $280 per month.
4. Purchased a one-year insurance policy on January 1 for $13200.
5. Purchased $1700 of supplies. On January 31, determined that $600 of supplies on hand.
Prepare the adjusting entries on January 31.
No. Account titles and explanation. Debit. Credit
1. (2 places for entries)
2 (2 places for entries)
3. (2 places for entries)
(to record depreciation expense)
3. (2 places for entries)
(To record interest expense)
4. ( 2 places for entries)
5. (2 places for entries).
The (2 places for entries refers to that there are two line for that entry)