Question & Answer: Analyzing Accounts Using Adjusted Data Selected T-account balances for Fields Company are shown below as of January 31, 2014; adjusting entries have already been post…..

Question & Answer: Analyzing Accounts Using Adjusted Data Selected T-account balances for Fields Company are shown below as of January 31, 2014; adjusting entries have already been post..... 1

Question & Answer: Analyzing Accounts Using Adjusted Data Selected T-account balances for Fields Company are shown below as of January 31, 2014; adjusting entries have already been post..... 2

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Analyzing Accounts Using Adjusted Data Selected T-account balances for Fields Company are shown below as of January 31, 2014; adjusting entries have already been posted. The firm uses a calendar-year accounting period but prepares monthly adjustments. Supplies (A) Supplies Expense (E) Jan.31 Bal Bal 7,680 Prepaid Insurance (A) Insurance Expense (E) Jan.31 al 4592 Jan.31 Bal 656 Wages Payable (L) Wages Expense (E) Jan.31 25,600 Bal 4000 Bal Accumulated Depreciation- Truck (XA) Truck (A) Jan.31 Bal

Expert Answer

 

a) Supplies used in January = $    7,680.00
Supplies Purchased during January= $    4,960.00
Supplies at the month end $    6,400.00
January 1st beginning balance of supplies= Supplies Used +Supplies in hand on January 31st-Supplies Purchased=($7680+$6400-$4960) $    9,120.00
b) Total Premium=($656*12) $    7,872.00
Prepaid Insurance $    4,592.00
Prepaid insurance for number of months=($4592/$656) 7
Insurance is purchased 7 months before 1st July 2013
Calculation of months
January 31st 2014
Dec 31st 2013
Nov 30th 2013
Oct 31st 2013
Sep 30th 2013
August 31st 2013
July 1st 2013
c ) Wages Expenses $ 25,600.00
wages Payable $    4,000.00
Wages Paid during January
Wages Expenses= (wages Paid+ wages Payable)=
Wages Paid=Wages Expenses-Wages Payable
Wages Paid=Wages Expenses-Wages Payable $ 21,600.00
Wages Paid during January $ 21,600.00
d) Truck Cost= $ 69,600.00
Useful life 5 years
Yearly Depreciation=($69600/5) $ 13,920.00
Monthly Depreciation=($13920/12) $    1,160.00
Monthly amount of Depreciation Expense= $    1,160.00

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