Reference no: EM132465071

Exercise 1: For each of the following,

Question 1) identify the types of adjusting journal entry necessary,

Question 2) prepare the adjusting entry necessary as of December 31. 2019 for the Tarver Company, and

Question 3) if a prepayment, prepare the adjusting journal entry for both the common and alternative approaches.

Point 1. On January 1, 2019, Tamer purchased equipment at a cost of $225,000. The equipment has an estimated salvage value of $5,000 and an estimated useful life of 20 years.

Point 2. As of December 31, 2019, employees have earned a total of $7,000 of wages that will be paid on January 5. 2020.

Point 3. On April 1, 2019, Tarver loaned 550.000 to another company and accepted a note. The note rescues interest to be paid annually each March 31 at beginning in 2020. The principal is due in 5 years.

Point 4. During the year, Tamer Co. purchased $12,500 of supplies. $1,000 of supplies remained on hand at December 31, 2019.

Point 5. On November 1, 2019. Taney received S3,000 rent in advance, from a tenant to cover rent for the nett3

Point 6. On December 1. 2019, Tarver paid $4,000 rent in advance to Baylor Leasing Company. The payment represented rent for the months December 2019 through March 2020.