Prepare the adjusting entries at march

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Reference no: EM131901800

Problem

The ledger of Perez Rental Agency on March 31 of the current year includes the selected accounts, shown below, before quarterly adjusting entries have been prepared.

	Debit	Credit
Prepaid Insurance	$ 12,600
Supplies	2,700
Equipment	25,000
Accumulated Depreciation-Equipment		$ 8,400
Notes Payable		24,000
Unearned Rent Revenue		10,700
Rent Revenue		58,000
Interest Expense	0
Salaries and Wages Expense	11,000

An analysis of the accounts shows the following.

1. The equipment depreciates $400 per month.
2. One-third of the unearned rent revenue was earned during the quarter.
3. Interest totaling $600 is accrued on the notes payable for the quarter.
4. Supplies on hand total $880.
5. Insurance expires at the rate of $700 per month.

Prepare the adjusting entries at March 31, assuming that adjusting entries are made quarterly. Additional accounts are Depreciation Expense, Insurance Expense, Interest Payable, and Supplies Expense.

Reference no: EM131901800

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