and last but not least
Refer to the trial balance of Morrell, Inc.
;
On July 1, Morrell paid four months in advance for insurance. ; Which of the following is included in the adjusting entry at July 31?
Choose one answer.
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Morrell, Inc.
Morrell, Inc. adjusts its books each month but closes its books at the end of the year. The trial balance at July 31 before adjustments is as follows:
|
Debit |
Credit |
|
Cash |
$12,920 |
|
Accounts Receivable |
9,620 |
|
Supplies |
1,300 |
|
Prepaid Insurance |
3,120 |
|
Equipment |
26,000 |
|
Accumulated Depreciation – Equipment |
$10,400 |
|
Unearned Service Revenue |
6,500 |
|
Capital Stock |
7,190 |
|
Retained Earnings |
23,400 |
|
Dividends |
1,560 |
|
Service Revenue |
16,510 |
|
Wages and Salaries Expense |
7,800 |
|
Utilities Expense |
380 |
|
Rent Expense |
1,300 |
|
$64,000 |
$64,000 |
| a. |
A credit to Prepaid Insurance for $2,340. |
| .b |
A debit to Prepaid Insurance for $780. |
|
| c. |
A credit to Prepaid Insurance for $780. |
|
| d. |
A debit to Prepaid Insurance for $2,340. |
