Adjusting Entries The following data were obtained from an analysis of the accounts of Noble… 1 answer below »

Adjusting Entries

The following data were obtained from an analysis of the accounts of Noble Distributor Company as of March 31, 2008, in preparation of the annual report. Noble records current transactions in nominal accounts. What are the appropriate adjusting entries?

(a) Prepaid Insurance has a balance of $14,100. Noble has the following policies in force:

Policy

Date

Term

Cost

Coverage

A

1/1/08

2 years

$ 3,600

Shop equipment

B

12/1/07

6 months

1,800

Delivery equipment

C

7/1/07

3 years

12,000

Buildings

(b) Unearned Subscription Revenue has a balance of $56,250. The following subscriptions were collected in the current year. There are no other unexpired subscriptions.

Effective Date

Amount

Term

July 1, 2007

$27,000

1 year

October 1, 2007

22,200

1 year

January 1, 2008

28,800

1 year

April 1, 2008

20,700

1 year

(c) Interest Payable has a balance of $825. Noble owes a 10%, 90-day note for $45,000 dated March 1, 2008.

(d) Supplies has a balance of $2,190. An inventory of supplies revealed a total of $1,410.

(e) Salaries Payable has a balance of $9,750. The payroll for the 5-day workweek ended April 3 totaled $11,250.