Reference no: EM131771417

Question - Prepare adjusting entries at March 31, assuming that adjusting entries are made quarterly. Additional accounts are: Depreciation Expense; Insurance Expensed; Interest Payable; and Supplies Expense.

The Ledger of Chopin Rental Agency on March 31 of the current year includes the following selected accounts before adjusting entries have been prepared.

                                                                                 Debit                     Credit

Prepaid Insurance                                                        3,600                    

Supplies                                                                      2,800

Equipment                                                                   25,000

Accumulated Depreciation- Equipment                                                       8,400

Unearned Rent Revenue                                                                           20,000

Rent Revenue                                                                                          6,300

Retained Earnings                                                                                    60,000

Interest Expense                                                          -0-

Wage Expense                                                             14,000                                  

An analysis of the accounts shows the following.

1. The equipment depreciates $250/month.

2. One-third of the unearned rent was earned during the quarter.

3. Interest of $500 is accrued on the notes payable.

4. Supplies on hand total $650.

5. Insurance expires at the rate of $300 per month.