Upload
anissa-gladman
View
235
Download
0
Tags:
Embed Size (px)
Citation preview
Planning Adjusting
Entries on a Worksheet
Chapter 6, Section 2
Adjustments
Changes to update general ledger accounts
CONCEPT: Matching Expenses with Revenue
Expenses incurred to earn revenue are reported in the same fiscal period as the revenue is earned and reported.
Worksheet is used to plan adjustments
Supplies Adjustment
Up to this point, we have only recorded the purchases of new supplies.
We must bring the asset and expense accounts up-to-date to reflect supplies used.
Example: Supplies account balance = $4,751.00 Actual supplies on hand = $2,187.00
Subtract these two numbers to determine amount of adjustment. $4,751.00 – 2,187.00 = $2,564.00
Debit Supplies Expense; Credit Supplies for the amount of the adjustment
Recording the Supplies Adjustment on the Worksheet
1
2
3. Label the two parts of this adjustment with a small letter a in parentheses, (a).
1. Write the debit amount.
2. Write the credit amount.
3
Insurance Adjustment
We must bring the asset and expense accounts up-to-date to reflect insurance used.
Example: Prepaid Insurance account balance = $1,200.00 Value of Insurance = $1,100.00
Subtract these two numbers to determine amount of adjustment. $1,200.00 – 1,100.00 = $100.00
Debit Insurance Expense; Credit Prepaid Insurance for the amount of the adjustment
Recording the Insurance Adjustment on the Worksheet
1
2
3. Label the two parts of this adjustment with a small letter b in parentheses, (b).
1. Write the debit amount.
2. Write the credit amount.
3
Proving the Adjustments column of the Worksheet
12
3. Rule double lines.
1. Rule a single line.
2. Add both the Adjustments Debit and Credit columns.
3
Assignments
Work Together 6-2 (Textbook pg. 161)
On Your Own 6-2 (Textbook pg. 161)
Application 6-2 (Textbook pg. 172)