Question

Cortina Company accumulates the following adjustment data at December 31. Indicate 1) The type of adjustment (prepaid expense, accrued revenue, and so on.2) The status of the accounts before adjustment (overstated or understated).

Answer 1

Answer:Incomplete question.

Problems are:

A. Supplies of $400 are on hand. Supplies account shows $1,600 balance.

B. Services performed but unbilled total $700

C. Interest of $300 has accumulated on a note payable.

D. Rent collected in advance totaling $1,100 has been earned.

Explanation:

A. Prepaid expenses. Asset Overstated

B. Accrued Revenue. Expenses understated, Asset Understated

C. Accrued Expenses. Revenue understated, liability understated, Expenses Understated

D. Unearned revenue. Liabilities overstated, Revenue understated

Answer 2

Assuming Cortina Company accumulates the following adjustment data at December 31. The type of adjustment is: Prepaid expenses.

Type of adjustment and account status

A. Supplies of $400 are on hand. Supplies account shows $1,600 balance.

Type of adjustment: Prepaid expenses

Status of account:

• Asset Overstated
• Expenses understated

B.  Services performed but unbilled total $700.

Type of adjustment:Accrued Revenue

Status of account:

• Assets Understated
• Revenues Understated

C.  Interest of $300 has accumulated on a note payable.

Type of adjustment: Accrued Expense

Status of account:

• Liability understated
• Expenses Understated

D. Rent collected in advance totaling $1,100 has been earned.

Type of adjustment: Unearned Revenue

Status of account:

• Liabilities Overstated
• Revenue understated

Inconclusion the type of adjustment is: Prepaid expenses

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