PM Auto Company sells car parts to customers. The company’s fiscal year-end is December 31. The December 31,2015, unadjusted trial balance appears below.
prepaid insurance— 24,000
accumulated depreciation— 37,000
income taxes payable—-5,000
common stock –35,000
retained earnings —10,000
cost of goods sold—–50,000
income taxes expense——5,000
Additional information necessary to prepare the year-end adjusting entries appears below. The Adjusting entries is where i need the most help.
a. Depreciation on the machines for the year is 10,000
b. employee salaries are paid every two weeks. The last pay period ended on December 23. Salaries earned from December 24 through December 31,2015 are 4000.
c. On September 1, 2015, Pm Auto borrows 35,000 from a local bank and signs a note. The note requires interest to be paid annually on august 31 at 9%. The principal is due in five years,
d. On march 1, 2015, the company purchases insurance for 24,000 for a one-year policy to cover possible injury to mechanics. The entire 24,000 was debited to prepaid insurance at the time of the purchase.
e.5,000 of supplies remains on hand at December 31,2015
f. on December 30, PM auto receives a utility bill of 2,200 for the month. The bill will not be paid until early January 2016, and no entry was recorded when the bill was received
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