Deferred expenses are advance payments for future expenses. When a business prepays an expense, it can debit an asset account and defer the recognition of the expense. Deferring an expense creates an asset, thus, the account is debited to recognize this prepayment. The adjustment entry for accrued salaries on December 31.

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Answer 1

Question

Chapter 3, Problem 3.9SE

1.

To determine

Concept Introduction: Deferred expenses are advance payments for future expenses. When a business prepays an expense, it can debit an asset account and defer the recognition of the expense. Deferring an expense creates an asset, thus, the account is debited to recognize this prepayment.

The adjustment entry for accrued salaries on December 31.

2.

To determine

Concept Introduction: Adjusting entries are made at the end of the accounting period to record revenues in the period they are earned and expenses in the period they occur. Assets and liabilities are also updated by adjustment entries. To present true and fair financial statements, adjustment entries are also required.

The adjustment entry to record earning of revenue.

3.

To determine

Concept Introduction: Adjusting entries are made at the end of the accounting period to record revenues in the period they are earned and expenses in the period they occur. Assets and liabilities are also updated by adjustment entries. To present true and fair financial statements, adjustment entries are also required.

The T accounts for passed entries.

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Interval Answer: A. B. C. Monthly D. on day 1st of every 1 O An unscheduled journal entry O Recording uncollectable receivables O Logging the usage of a prepaid service O Setup of a recurring transfer month(s) Start date 01/01/2026 End After 12 occurrences

On January 1, 2024, Rick's Pawn Shop leased a truck from Corey Motors for a six-year period with an option to extend the lease for three years. • Rick's had no significant economic incentive as of the beginning of the lease to exercise the three-year extension option. Annual lease payments are $12,000 due on December 31 of each year, calculated by the lessor using a 7% discount rate. . The expected useful life of the asset is nine years, and its fair value is $90,000. . Assume that at the beginning of the third year, January 1, 2026, Rick's had made significant improvements to the truck whose cost could be recovered only if it exercises the extension option, creating an expectation that extension of the lease was "reasonably certain." The relevant interest rate at that time was 8%. Note: Use tables, Excel, or a financial calculator. (FV of $1. PV of $1. FVA of $1. PVA of $1. EVAD of $1 and PVAD of $1) Required: 1. Prepare the journal entry, if any, on January 1 and on December 31 of…

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Answer 2

Question

Chapter 3, Problem 3.9SE

1.

To determine

Concept Introduction: Deferred expenses are advance payments for future expenses. When a business prepays an expense, it can debit an asset account and defer the recognition of the expense. Deferring an expense creates an asset, thus, the account is debited to recognize this prepayment.

The adjustment entry for accrued salaries on December 31.

2.

To determine

Concept Introduction: Adjusting entries are made at the end of the accounting period to record revenues in the period they are earned and expenses in the period they occur. Assets and liabilities are also updated by adjustment entries. To present true and fair financial statements, adjustment entries are also required.

The adjustment entry to record earning of revenue.

3.

To determine

Concept Introduction: Adjusting entries are made at the end of the accounting period to record revenues in the period they are earned and expenses in the period they occur. Assets and liabilities are also updated by adjustment entries. To present true and fair financial statements, adjustment entries are also required.

The T accounts for passed entries.

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Answer 3

Question

Chapter 3, Problem 3.9SE

1.

To determine

Concept Introduction: Deferred expenses are advance payments for future expenses. When a business prepays an expense, it can debit an asset account and defer the recognition of the expense. Deferring an expense creates an asset, thus, the account is debited to recognize this prepayment.

The adjustment entry for accrued salaries on December 31.

2.

To determine

Concept Introduction: Adjusting entries are made at the end of the accounting period to record revenues in the period they are earned and expenses in the period they occur. Assets and liabilities are also updated by adjustment entries. To present true and fair financial statements, adjustment entries are also required.

The adjustment entry to record earning of revenue.

3.

To determine

Concept Introduction: Adjusting entries are made at the end of the accounting period to record revenues in the period they are earned and expenses in the period they occur. Assets and liabilities are also updated by adjustment entries. To present true and fair financial statements, adjustment entries are also required.

The T accounts for passed entries.

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Answer 4

Question

Chapter 3, Problem 3.9SE

1.

To determine

Concept Introduction: Deferred expenses are advance payments for future expenses. When a business prepays an expense, it can debit an asset account and defer the recognition of the expense. Deferring an expense creates an asset, thus, the account is debited to recognize this prepayment.

The adjustment entry for accrued salaries on December 31.

2.

To determine

Concept Introduction: Adjusting entries are made at the end of the accounting period to record revenues in the period they are earned and expenses in the period they occur. Assets and liabilities are also updated by adjustment entries. To present true and fair financial statements, adjustment entries are also required.

The adjustment entry to record earning of revenue.

3.

To determine

Concept Introduction: Adjusting entries are made at the end of the accounting period to record revenues in the period they are earned and expenses in the period they occur. Assets and liabilities are also updated by adjustment entries. To present true and fair financial statements, adjustment entries are also required.

The T accounts for passed entries.

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Answer 5

Chapter 3, Problem 3.9SE

1.

To determine

Concept Introduction: Deferred expenses are advance payments for future expenses. When a business prepays an expense, it can debit an asset account and defer the recognition of the expense. Deferring an expense creates an asset, thus, the account is debited to recognize this prepayment.

The adjustment entry for accrued salaries on December 31.

2.

To determine

Concept Introduction: Adjusting entries are made at the end of the accounting period to record revenues in the period they are earned and expenses in the period they occur. Assets and liabilities are also updated by adjustment entries. To present true and fair financial statements, adjustment entries are also required.

The adjustment entry to record earning of revenue.

3.

To determine

Concept Introduction: Adjusting entries are made at the end of the accounting period to record revenues in the period they are earned and expenses in the period they occur. Assets and liabilities are also updated by adjustment entries. To present true and fair financial statements, adjustment entries are also required.

The T accounts for passed entries.

Answer 6

Chapter 3, Problem 3.9SE

1.

To determine

Concept Introduction: Deferred expenses are advance payments for future expenses. When a business prepays an expense, it can debit an asset account and defer the recognition of the expense. Deferring an expense creates an asset, thus, the account is debited to recognize this prepayment.

The adjustment entry for accrued salaries on December 31.

Answer 7

Chapter 3, Problem 3.9SE

1.

To determine

Concept Introduction: Deferred expenses are advance payments for future expenses. When a business prepays an expense, it can debit an asset account and defer the recognition of the expense. Deferring an expense creates an asset, thus, the account is debited to recognize this prepayment.

The adjustment entry for accrued salaries on December 31.

Answer 8

2.

To determine

Concept Introduction: Adjusting entries are made at the end of the accounting period to record revenues in the period they are earned and expenses in the period they occur. Assets and liabilities are also updated by adjustment entries. To present true and fair financial statements, adjustment entries are also required.

The adjustment entry to record earning of revenue.

Answer 9

2.

To determine

Concept Introduction: Adjusting entries are made at the end of the accounting period to record revenues in the period they are earned and expenses in the period they occur. Assets and liabilities are also updated by adjustment entries. To present true and fair financial statements, adjustment entries are also required.

The adjustment entry to record earning of revenue.

Answer 10

3.

To determine

Concept Introduction: Adjusting entries are made at the end of the accounting period to record revenues in the period they are earned and expenses in the period they occur. Assets and liabilities are also updated by adjustment entries. To present true and fair financial statements, adjustment entries are also required.

The T accounts for passed entries.

Answer 11

3.

To determine

Concept Introduction: Adjusting entries are made at the end of the accounting period to record revenues in the period they are earned and expenses in the period they occur. Assets and liabilities are also updated by adjustment entries. To present true and fair financial statements, adjustment entries are also required.

The T accounts for passed entries.

Answer 12

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Answer 13

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Answer 14

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Answer 15

Ch. 3 - Which of the following is true of accrual basis...Ch. 3 - Get Fit Now gains a client who prepays 540 for a...Ch. 3 - The revenue recognition principle requires a. time...Ch. 3 - Adjusting the accounts is the process of a....Ch. 3 - Which of the following is an example of a deferral...Ch. 3 - Assume that the weekly payroll of In the Woods...Ch. 3 - The adjusted trial balance shows a. amounts that...Ch. 3 - A D Window Cleaning performed 450 of services but...Ch. 3 - A worksheet a. is a journal used to record...Ch. 3 - On February 1, Clovis Wilson Law Firm contracted...

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