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(Accounting) Adjusting help!?
Question
How to do adjusting ?
"At the end of January the inventory of widgets is estimated to be $22000. Supplies were counted and there was $900 on hand. Depreciation policy was Furniture (straight-line over 5 years with a salvage value of 400); Store Fixtures ( declining balance at 15% per year); and Equipment (declining balance at 10% per year.
Supplies balance $ 1450
Furniture balance $ 7500
Store Fixtures balance $ 24950
Equipment balance $ 18500
Pls help me do adjusting
For supplies
Unadjusted balance $1450 (per GL)
Supplies on hand $900
Adjustment required 550
Is this right? Pls answer and explain how you get the number
m(_ _)m Thank you do much
@Old Guy ty can u also answer the rest of the question?
1 Answer
- Old GuyLv 79 years agoFavorite Answer
Yes, $550 is right. Supplies on hand is an asset account, so you need to adjust it's balance to the value counted at the end of the month.
Debit Supplies Expense $550
Credit Supplies on hand $550
Edited to add:
The adjustments for depreciation are:
Furniture [(7500 - 400) / 5] x 1/12 = 118.33
Store Fixtures (24,950 x 15%) x 1/12 = 311.88
Equipment (18,500 x 10%) x 1/12 = 154.17