Question

The following is a partial unadjusted Trial balance

Unadjusted Trial Balance (partial)

1/31/16

ACCOUNTS :

DEBIT

CASH $32,527

Prepaid insurance 1,800

Insurance expense 0

CREDIT

NONE

On, January 1, 2016, Bravo Unlimited purchased a 9month motor vehicle insurance policy for $1,800. Use this information to prepare the Adjusting General Journal entry (without explanation) for January. If no entry is required then write "No Entry Required."- 2.Bravo Unlimited provided accounting services, valued at $5,000, to its clients during the month of January 2016. Formal bills are sent to clients during the first week following the month in which services are provided. Use this information to prepare the General Journal entry (without explanation) for the required end of the month adjustment. If no entry is required then write "No Entry Required."

Answer 1

Answer:

insurance expense  200 debit

prepaid insurance  200 credit

--to record expired --insurance    

accounts receivables  5000 debit

services revneue      5000 credit

--to record completion on services--    

Explanation:

insurance calculations:

1,800 dollar for a nine month policty

1,800 / 9 = 200 dollar per month

we decrease the prepaid and recognize he expense

second entry:

As we perform the service we accrued the reveneu during January thus, we recognzie the service revenue and the accounts receivables even, before the billing arrives to the customer