Reference no: EM132240461
Question - The ledger of Armour Lake Lumber Supply on July 31, 2020, includes the selected accounts below before adjusting entries have been prepared.
Debit Credit Notes
Payable $21,600
Supplies $24,000
Prepaid Rent 3,300
Buildings 258,000
Accumulated Depreciation - Buildings132,000
Unearned Service Revenue 11,800
An analysis of the company's accounts shows the following.
1. The notes payable pays interest at a rate of 6% per year.
2. Supplies on hand at the end of the month totaled $18,200.
3. The balance in Prepaid Rent represents 4 months of rent costs.
4. Employees were owed $2,600 related to unpaid salaries and wages.
5. Depreciation on buildings is $6,000 per year.
6. During the month, the company satisfied obligations worth $5,000 related to the Unearned Services Revenue.
7. Unpaid maintenance and repairs costs were $2,700.
Prepare the adjusting entries at July 31 assuming that adjusting entries are made monthly. Use additional accounts as needed.