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Home / Questions / On January 1, 2021, Red Flash Photography had the following balances: Cash, $29,000; Suppl...

On January 1, 2021, Red Flash Photography had the following balances: Cash, $29,000; Supplies, $9,700; Land, $77,000; Deferred Revenue, $6,700; Common Stock $67,000; and Retained Earnings, $42,000. Du

On January 1, 2021, Red Flash Photography had the following balances: Cash, $29,000; Supplies, $9,700; Land, $77,000; Deferred Revenue, $6,700; Common Stock $67,000; and Retained Earnings, $42,000. During 2021, the company had the following transactions:

 

1.   February   15   Issue additional shares of common stock, $37,000.
2.   May   20   Provide services to customers for cash, $52,000, and on account, $47,000.
3.   August   31   Pay salaries to employees for work in 2021, $40,000.
4.   October   1   Purchase rental space for one year, $29,000.
5.   November   17   Purchase supplies on account, $39,000.
6.   December   30   Pay dividends, $3,700.

 

The following information is available on December 31, 2021:

  1. Employees are owed an additional $5,700 in salaries.
  2. Three months of the rental space has expired.
  3. Supplies of $6,700 remain on hand.
  4. All of the services associated with the beginning deferred revenue have been performed.

Record the adjusting entry for supplies on December 31.

 

 

Sep 19 2020 View more View Less

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