A partial trial balance of Dickinson Corporation is as follows on December 31, 2010.
Supplies on hand___________________$ 2,500
Accrued salaries and wages_______________________ $ 1,500
Interest Receivable__________________ 5,100
Prepaid insurance___________________ 90,000
Unearned rent ___________________________________ -0-
Accrued interest payable __________________________ 15,000
Additional adjusting data:
1. A physical count of supplies on hand on December 31, 2010, totaled $1,100.
2. Through oversight, the Accrued Salaries and Wages account
was not changed during 2010. Accrued salaries and wages on December 31,
2010, amounted to $4,400.
3. The Interest Receivable account was also left unchanged
during 2010. Accrued interest on investments amounts to $4,350 on
December 31, 2010.
4. The unexpired portions of the insurance policies totaled $65,000 as of December 31, 2010.
5. $24,000 was received on January 1, 2010 for the rent of a
building for both 2010 and 2011. The entire amount was credited to
6. Depreciation for the year was erroneously recorded as $5,000 rather than the correct figure of $50,000.
7. A further review of depreciation calculations of prior
years revealed that depreciation of $7,200 was not recorded. It was
decided that this oversight should be
corrected by a prior period adjustment.
(a) Assuming that the books have not been closed, what are the adjusting entries necessary at December 31, 2010? (Ignore income tax considerations.)
(b) Assuming that the books have been closed, what are the adjusting entries necessary at December 31, 2010? (Ignore income tax considerations.)
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