126 CHAPTER 4 Adjustments

Each adjustment entry must affect an account on the statement of financial position or balance sheet to an account of
income statement, if not, it is not considered an adjustment.
InthisThe chapter analyzes two groups or classifications of adjustment entries: those that are typical of the accounts of
income and those related to expense accounts.
As in the previous chapter, dedicated to recording business operations, the methodology used for
to record accounting adjustments as part of a transaction analysis, their entry in the general journal, their correct
classification in the general ledger and concludes with the preparation of an adjusted trial balance.

Questionnaire
Explain why it is necessary to make adjustments to accounting information.
What does the postulate of cost and expense association with income refer to and what relationship does it have with the
Adjustment procedure?
What is the assumption of the accounting period and what is its relationship with the process of accounting adjustments?
What characteristics must an adjustable seat have to be considered as such?
What are the types of adjustments necessary for income accounts and what is their purpose?
that are prepared?
Menciona tres ejemplos de asientos de ajuste que tengan relación con cuentas de ingresos. Describe el
Accounting treatment that should be given to unrecorded accrued income. What is the procedure for it?
Accounting entry that should generally be made for adjustments related to expense accounts?
Describe the types of adjustments related to expense accounts and explain the purpose of preparing them.
When does a prepaid expense occur and what accounting treatment should be given to it? Research what it means.
concept of depreciation for accounting purposes and explain each of the elements that are considered for
its calculation. What is an adjusted trial balance?
10
11.

12.

Multiple choice
Select the correct answer.
The entries used to update the accounts of assets, liabilities, income, and expenses are called:
a) Journal entries.
b) Closing entries.
c) Adjustment entries.
d) Accounting entries.
e) None of the above.

2. The adjustment seats are frequently made in the following way:

Monthly.
b) Quarterly.
c) Annual.
Daily.
e) Only a, b, and c.

3. The starting point to initiate the adjustment procedure is:

a) The classification in the overall ranking.

b) The adjusted trial balance.

c) The accounting records.
 Multiple choice 127

d)The trial balance before adjustments.

e)None of the above.

4. The purpose of making adjusting entries to the income accounts is:

a) Correctly express the revenues in the income statement.
b) Express the net profit correctly in the income statement.
c) Recognize the income obtained in the accounting period.
a)Recognize the profit obtained in the accounting period.
Only b and c.

5. Some examples of unrecorded accrued income are:

a) Royalties receivable for earned rights from publications.

concept of services pres-

b) Customer advances.
c) Accounts receivable for services rendered.

Only a and c.
e) None of the above.

6. The procedure to follow to adjust the advance payments for taxes is:
a) It is charged to the liability account called customer advances.

b) It is charged to the cash or bank account.

c) It is credited to the liability account called customer advances.
d) It is credited to the cash or bank account.
Only b and c.

For accounting or financial purposes, the term accrual means:

Take revenge.
to incur
c) To spend.

Registrar.
e) Only a and b.

8. Prepaid expenses, such as insurance and rents or leases, represent:

a) A liability.
an expense.
an income
an asset.
e) None of the above.

9. The only fixed assets whose value does not deteriorate are:
The buildings.
b) The machinery.
c) The transport team.
The land.
e) None of the above.
 10. Depreciation expense does not represent a real cash outflow, so it is known as:
a) A real game.
b) An accounting entry.
a virtual match.
A visual match.
None of the above.

128 CHAPTER 4A adjustments

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Exercises
I. For each of the following operations, indicate in the first column if an adjustment is required.
income or an expense adjustment at the end of the accounting period, and in the second column specify what type
adjustment would be: accrued income not recorded, customer advances, expenses incurred not
registered, prepaid expenses or depreciation expense.

Ajuste de
income or Type of
adjustment of adjustment
expenses
Services rendered that will be charged later.
Salaries for the period that have not been paid.
Office supply consumption.
Services charged previously and that were carried out in this
period.
Depreciation of office equipment.
Expiration of an insurance policy.
Taxes for the period that will be paid later.
Use of a warehouse whose rent was paid in advance.
Interest on a bank loan that will be paid when
pay off the loan.
Consumption of gasoline vouchers.

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2. The following are some accounts from a trial balance before adjustments, for each one
indicate whether at the end of the accounting period any adjustment is required or not. If affirmative, indicate
what kind of adjustment would it be:
 Count Answers
Banks
Clients
Insurance paid in advance
Land
Office equipment
Accumulated depreciation of equipment
of office
Suppliers
Customer advances
Bank loan payable
Retained earnings

Exercises129

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3. The following sections provide information that shows the need to make a
expense adjustment. For each one, indicate the corresponding amount:
a) There are three employees who earn $850 each for a six-day work week. The accounting period
It ends on September 30, which is a Tuesday; however, the employees will be paid their salary.
Saturday, October 4.
The salary expense for the last week of September is $__________________.
On August 10, a bank loan of $500,000 was obtained, which will be paid in three months.
Will charge at the end of the three months an interest at a rate of 10% per year.
The interest expense for the month of August is $__________________________.
A insurance policy was acquired for $120,000 with a validity of one year.
The monthly insurance expense is $_________________________.

4. According to the information provided for the preparation of income adjustments

At the end of the accounting period, calculate the amount of the adjustment that corresponds:
a) Credit services were provided during the period for a total of $130,000, which has not been recorded.
The adjustment of service income for the period is $________________________.
On January 2, $250,000 was received as an advance payment for services from a client to whom
will provide advice on computing services for five months.
The adjustment of income for services earned as of January 31 is $__________________.
c) From the total income of a period, part of it was not recorded because it was on credit. The total income
They were $875,000, 20% was on credit.
The adjustment of income from services (not registered) is $____________________.

5. On February 15, a delivery truck was purchased for $350,000, with an estimated useful life of
seven years and a redemption value of $80,000. Determine the following:
a) The depreciation expense for the month of February is $_______________________.
b) The accumulated depreciation as of February 28 is $_______________________.
c) The depreciation expense for the month of March is $_______________________.
d) The accumulated depreciation as of March 31 is $_______________________.
e) The depreciation expense for the month of December is $_____________________.
 f) The accumulated depreciation as of December 31 is $______________________.

6. The following information pertains to the company Ritcher, S.A. during October of the year 200X:
The expense for depreciation of furniture and equipment is $20,000 monthly.
b) The interest corresponding to the bank loan is $12,000 monthly.
c) The company paid the rent for the entire year in advance, so it is due
recognize the amount of $16,000 monthly for rent.

It is requested:

Prepare the entry in the journal for the adjusting entries.

7. Based on the following information, prepare the adjusting entries as of December 31, 200X.
closing date of the annual accounting period:
a)Machinery was purchased on March 1, 200X for $400,000, which has a useful life of four
years and it is estimated that it will depreciate in equal parts each month.

130 CHAPTER 4Settings

b) On April 3, an annual fire insurance for $240,000 was purchased, which was paid in advance for
cash.
c) On May 2, a bank loan of $300,000 was requested, with an annual interest of 12% payable.
monthly.

On July 10, the Edursa Construction Company received an advance payment of $2,750,000 for advisory services.
design and construction of an apartment building. The advance corresponds to a period of six months from
that the check was delivered. Determine the following:

a) The earned income adjustment for services as of July 31 is $__________________________________.

b) The balance of the customer advances account as of July 31 is $__________________________________.
c) The adjustment of income for services earned as of August 31 is $______________________________.
d) The balance of the customer advances account as of August 31 is $________________________________.
The balance of the customer advances account as of December 31 is $_________________________________.
f) When should the last income adjustment for earned services be made?_________________________.
g) What would be the amount of the adjustment? $______________________________.

9. When an adjusting entry is made, it affects an income statement account (revenue or expense) and a balance sheet account.
balance sheet (asset or liability). For each of the adjustments mentioned, determine which account of
income statement that is affected and which is the balance sheet account that is modified:

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Account of Account of
Adjustment information
results balance
Salaries for the period that have not been paid were recognized.

Services were recorded as performed and not billed.

The depreciation of the office equipment has been recorded.
 The portion of the fire insurance that expired was acknowledged.
The consumption of office supplies has been recorded.
The interests of the period that are due were recorded.
The provision of services charged by was recognized
anticipated.
The part of the rent paid in advance was recognized that
it has expired.
10. The following format presents some accounts from the trial balance before adjustments, the adjustments and the
Adjusted trial balance as of December 31. Explain what each of the adjustments presented consists of:

CuentaBalanza antes de ajustesAjustesBalanza

ajustadaDebeHaberDebeHaberDebeHaberRenta pagada por adelantado36
0005) 6 00030 000Delivery team 250 000250 000Accumulated depreciation of
{"reparto":"delivery team","anticipos de clientes":"customer advances"}
Salaries payable 2) 8,000 8,000

(conti
núa)

Interest payable 0 3) 7,500 7,500

Income from services 340 20,000 360,000
000
Expenses for salaries 56,000 8,000 64,000
Interest expenses 0 3) 7,500 7,500
Depreciation expenses 0 25,000 25,000
Rental expenses 0 6,000 6,000

1. __________________________________________________________________________________________
2.__________________________________________________________________________________________
3.__________________________________________________________________________________________
4. __________________________________________________________________________________________
5.__________________________________________________________________________________________

Problems
On December 31, the accountant of Cárdenas and Asoc, S.C. prepared the income statement and the balance sheet.
General of the year 200X, but forgot to consider the record of three adjustment entries:
d)The annual depreciation of the delivery equipment is $50,000.
b)Uncollected income of $20,000.
c)Operating expenses for the year amounting to $70,000 that are still pending payment.
It is requested:
 Correct the financial statements prepared by the accountant in the two columns provided; note in the
primera el importe del ajuste que debe hacerse a la cuenta y en la segunda el importe corregido de la cuenta.

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Registered Adjustment Corrected

Income statement
Income 875,000

Expenses (540,000)

Net utility 335,000

Balance generalActivos
Banks 150,000

Clients 720,000

Delivery team 480,000

Accumulated depreciation of delivery equipment 35,000

1,315,000
Liabilities
Suppliers 130,000

Equity
Social capital 500,000

Retained earnings 685,000

1,315,000

Problems133

4. Below is the trial balance of Klean company as of March 31, 200X:

Account Must News
Banks 82,400
Clientes 42 530
Rent paid in advance 40,000
Materials 28 100
Transport team 580,000
Depreciation accumulated/team of 102 000
transport
Office furniture 240,000
Accumulated depreciation/office furniture 48,000
Suppliers 46 400
Documents payable 209 300
Share capital 500,000
Retained earnings 18,930
Income from services 197,950
Expenditure on salaries 65,000
Public services expense 15700
Advertising expense 25,000
Various expenses 3,850
Total $1,122,580 $ 1 122 580
 Additional information:
The depreciation expenses for transportation equipment and office furniture are $8,500 and $4.
000, respectively.
The balance of the prepaid rent account is for four months and the expense must be recognized.
corresponding to the month of April.
The expenditure on materials for the month was $8,660.
The outstanding interest expenses amount to $3,700.
It is requested:

a) Record the adjusting entries for April.

b) Prepare the adjusted trial balance.

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5. La Perla, S.A. is a company dedicated to the cleaning and repair of watches and jewelry that started
operations in January of 200X. The trial balance for the month ending December 31 of
200X is the following:

CuentaDebeHaberBancos158 090Clientes74 800

(continu
action) Materiales de limpieza26 100Seguro pagado por anticipado80 000f
-Terreno140 000Edificio450 000Depreciación acumulada/edificio38 500Equipo
de limpieza220 000Depreciación acumulada/equipo de limpieza33 (continues)
000Mobiliario193 000Depreciación acumulada/mobiliario30 800Proveedores99
060Documentos por pagar a largo plazo350 000Capital social520
390Utilidades retenidas128 490Ingresos por servicios214 300Gasto por
sueldos5 000Gasto de mantenimiento22 300Gasto por servicios públicos14
100Gasto por publicidad25 300Gastos varios5 850Totales1 414 5401 414 540

134 CHAPTER4Settings

Additionalinformation:
• Thebuildinghasausefullifeof10yearsandasalvagevalueof$30,000.
• Thecleaningequipmentwasestimatedtohaveausefullifeoffiveyearswithavalueof$40,000.
• Thefurniturewasestimatedtohaveausefullifeoffiveyearsandasalvagevalueof$25,000.
• TheinsurancewascontractedonAugust1forayearandthemonthlyexpenseswererecognizeduntilthepreviousperiod.
• Thebalanceofthecleaningmaterialsaccount,afteraphysicalcount,is$8940.
• Interestwasgeneratedduringthemonthfor$5900,whichisstil pendingpayment.

Itisrequested:
 Recordthenecessaryadjustmententriesandprepareanadjustedtrialbalance.

[Link]íazduringMarch,themonthinwhichitbeganasacarwashingbusiness,were:
[Link]$900,000thatwasdepositedintoabankaccountinthenameof
business.
[Link]$400,000.$200,000waspaidwithabankcheckandtherestwithabankloan.
threeyearsforwhichadocumentwassignedfor$200,000payableattheendofthethreeyearswithanannualinterestrateof12%,payable
[Link]$64,000.
[Link]$180,000,ofwhich$72,000waspaidasadownpaymentandtheremainderwillbepaidduring
[Link],withoutsalvagevalue.
[Link]$128,[Link],withavalueof
$17600
[Link]$25,000,whichwillbepaidin10days.
[Link]$35,000.

Problems135

OnSeptember17,a$6000announcementwaspaidforinthenewspapertopromotethecompany'sservices.
Dí[Link]óvilespor$18000,deloscuales60%secobróenefectivoyelrestoacrédito.
[Link].
Onthe25th,theypaid$10,000tothemunicipalauthoritiesforthenecessarypermitsforthecarwashbusiness.
[Link]$22,000wasgeneratedfromservices,ofwhichhalfwascollectedincashandtherestoncredit.
[Link]$5000.
Onthe31st,theywillpaythecorrespondingwagesandsalariesforthesecondhalfofthemonth.
OnMarch31,theinventoryofcleaningmaterialshadavalueof$[Link]:
a) Record the March transactions in the general ledger.
b) Make adjustments for depreciation, materials, and interest payable.
c) Prepare an adjusted trial balance.

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OnFebruary28,thefollowingbalancesofServiciosComputacionales,[Link],uponconcludingtheirfirstmonthofoperations:
Netutilityofthemonth $387400
Totalassets $890000
Totaldepasivos $340000
Totalofequitycapital $550000

Inpreparingthefinancialstatements,someadjustmentsweredetectedthatneededtoberecordedbeforepreparingthereports:
a) Services rendered to credit for $12500.
b) Depreciation of office equipment for $2500.
Pending salaries to be paid for $16,000.
d) Office supplies consumed for $3200.
Itisrequested:
 Theyregisterinthedailythecorrespondingadjustments.
[Link]
[Link],totalassets,totalliabilities,andtotalequityasofthe28th.
February.

8. The following information for Electro-Reparaciones, S.A. as of December 31, 200X:

Informationrelatedtoincome
[Link] services for counters during the year $643000
1. Anticipate for various repair jobs in an office $30 000
3 repairs to credit that will be charged in January of 200X+1 $65 000
dh
evlm
uonf
ats
heashnreob.1tX
i02-tcelm
orc
le.o4tC
su $27500

Chapter 4 Adjustments

Information regarding salaries

1. Salaries pending payment from 200X-1 $10,000
$240
[Link] and wages of 200X $20
3. Salaries of 200X that will be paid in January of 000
200X+1

Information regarding repair materials

1. Material balance as of January 1, 200X $9,000
$150
[Link] of materials during 200X 000 $32
[Link] of materials that remained on December 31 of 000
200X

It is requested:

Calculate the balance of each of the accounts in the financial statements of Electro-Reparaciones, S.A.
that are listed below:
a)Income from services.
b)Expenses for salaries.
c)Expense for repair materials.
d)Clients.
e) Repair materials.
f) Salaries payable.

9. At the end of its accounting period, on December 31, Julio Aguilar and Associates, S.C. had the
next information:
a) On July 1, a fire insurance policy was paid with a validity of three
years from that date. The payment was for $10,000.
b) During the year, office supplies were purchased for cash for $15,000. To
At the beginning of the year, there were materials worth $3,000, and by the end of the year, only $2,500 remained.

of unused materials.
c) In the last week of December, Julio Aguilar took his car for repairs, which is-
registered as part of the company's transport team. The repair cost $7
800, but since Julio is a friend of the owner of the workshop, they gave him a month to pay.
 d) At the end of December, the electricity bill arrived for $5,600. The date of
the due date is January 15 of the following year and therefore was not paid before
December 31.
e) On December 20, a client's consulting project was completed. They will be charged.
$35,000, on January 15. The work has not yet been recorded.
f) On June 1, a new computer was purchased at a cost of $25,000. It is estimated
that the annual depreciation is $6,500 although it has not yet been recorded.
g) On September 15, the company received a bank loan of $300,000 at a
year with an interest rate of 12% per year. Both the principal and the interest will be paid
at the end of the year.

It is requested:

a) For each item, indicate which type of adjustment it relates to:

1. Unrecorded accumulated income.
[Link] advances.
[Link] expenses not recorded.
[Link] expenses.
5. Depreciation.

b)Prepare the adjusting entries that must be recorded in the journal at the end of the accounting period.

10. Using the data from the previous problem, answer the following (each item corresponds to
the same letter as problem 9):
a)What difference would there be in the adjustment if the policy were valid for two years? What
accounts would change their balance on December 31 and what would be the amount?
b)What is the amount of the materials account that will be recorded in the balance sheet?
December 31?

Complementary problems 137

c) What changes would there be in the financial statements if it had been paid in cash?
d)What change would the net income have if I had paid the bill before that
Will the accounting period end? Quantify.
e)Which accounts are affected when recognizing the adjustment for unrecorded income? What is it?
What is the impact on each one: does it increase or decrease and by how much?
f)What effect would it have on net income if the useful life of the computer were reduced?
What effect would it have on the balance sheet of the accounting period being recorded?
g) What difference would there be in the adjusting entry of December 31 if the interests are
Will payments be made monthly, on the last day of each month? Would there be any change in the status?

of results or in the balance sheet? In which accounts? For what amount?

1. The following describes some transactions that need to be carried out at the end of a
period, the adjusting entries of a business.
a)Salaries for the period that have not been paid or recorded.
b)Consumed office supplies that have not been recognized.
c)Earned revenue that was collected in advance and has not been recorded.
d) Income earned in the period that has not been collected or
registered. Unpaid taxes for the period that have not been paid nor
recognized.
f)Public services used during the period that have not yet been paid or recorded.
g)Advertising for the company, already carried out during the period and pending
payment and

of registration.
 If asked:
Indicate what type of adjustment needs to be made: Prepaid expenses, customer advances,
gasto icumulado, ingreso acumulado.

2. The following information is available as of April 30, 200X for Tamez Navarro Consultores:
a)There are accumulated revenues for the month of April amounting to $63,900 that as of April 30 have not yet
have not been invoiced or charged.
b) The balance of the materials account as of April 30 shows a balance of $27,090.
embargo, the materials available to date are $10,350.
c)The accumulated salaries for the month of April that have not yet been paid as of April 30.
total $12,420.
d)The balance of the prepaid rent account as of April 30 is $44,500.
despite the fact that this amount corresponds to a rent of five months that began to
count the day April 1.
e) The depreciation of equipment during the year is $10,080. This equipment was purchased
For the past two years, and still the amount corresponding to the month of April has not been recognized.

It is requested:

Identify the accounts that need to be updated and prepare the adjustment entries as of April 30.
to update those accounts.

3. Analyze the impact on the accounting equation for each of the following transactions,
for-
given the balances before adjustments of the accounts indicated below:
Materiales $3 000; Clientes $3 220; Seguro pagado por adelantado $3 400; Anticipo de
clientes $1 760; Gasto por salarios $5 275:

a)The balance of materials as of December 31 decreased to $1,760.

b)The validity of the prepaid insurance indicates that from the balance of $3,400 only
There are $2,300 due.

138 CHAPTER 4 Adjustments

c) L a cuenta de anticicustomer position has

dism Inuido a $1 240.
d) There is an additional expense for salaries of
pperiod for $1,250 that has not yet been paid.
e) There are accrued revenues during the period, which have not been collected and total
$1500.

f) The depreciation expense of the month

It was $150 and it has not been registered yet.
It is requested:

a)Identifica cuáles cuentas aumentan su saldo y en qué cantidad y cuáles disminuyen su saldo y en qué
amount. Example: increases expense for rent and increases rent payable.
b) Determine the new balance of each account.

4. Analyze the effect that the following information about adjustments has on the accounting equation:
a) There are service revenues of $2,250 that have not yet been recorded or collected.
b) The office materials expense for the period is $2,300 and has not been recorded.
trade.
c) The rental expense for the month of $3,000, which was paid in advance, should be considered.
d) The expense for equipment depreciation for the period is $2,275, and it has not yet been
register.
 The salary payable for the period is $2,950 and has not yet been recorded.
f) From the advances received from clients, services worth $2 have been provided during the period.
150.

It is requested:

Señala las cuentas de activo, pasivo y capital que aumentan y las cuentas que disminuyen. Menciona las cuentas
of expenses and/or income that increase.

5. Identify how the State is affected

Results and the Statement of Financial Position,
with
the following transactions:
a) Recognize the accrued salary expense for the
last day of the pending period
of payment.
b) Record the depreciation expense for the period.
c) From customer advances, recognize the services that have already been performed.
d) Adjust the prepaid insurance, the part that is already due.
e) Record services that have already been performed but have not been charged.
Recognizes the amount that decreased the materials account due to consumption for the period.
g) Record the total interest generated during the period that remains unpaid.
h) Recognizes the portion of rent paid in advance that has been earned.
It is requested:

Mention each of the accounts from the two financial statements that must be updated. Example: from the Statement
Results indicate that spending on income should be increased, and the Statement of Financial Position should decrease the income.
paid in advance.

6. Ramírez Iglesias, S.C. has the following trial balances (adjusted and unadjusted) for the
December 31, 200X:

RAMÍREZ IGLESIAS, S.C.

Trialbalance
onDecember31of
200X
Not adjusted Adjusted
Banks 39270 39270

Clients 57540 63320

Officematerial 1,880 1350

 SupplementaryProblems139

(continue
action Seguro pagado por adelantado3 0001 800Terreno390 000390
000Equipo de oficina60 00060 000Depreciación acumulada equipo12
00013 500Various creditors3 7903 790Salary payable02
500Capital social250 000250 000Utilidades retenidas115 900115
900Ingresos por servicios223 690229 470Gasto por salarios36 00038
500 Expense for rent 12,000 12,000 Expense for insurance -1,200 Expense for
services5 6905 690Depreciation expense -1 500Expense for
office materials-530Total605 380605 380615 160615 160

It is requested:

1. Identify the accounts that show a change in their balance.

2. Determine the amount of the change in each of the adjusted accounts.
3. Prepare the adjustment entries corresponding to December 31 that caused the changes in the
account balances.

7. The trial balance as of 31

December (without adjustments) of Tere Hernández
owner of Kids Circus, service business
for children's events, it shows
continuation.
KIDS
CIRCUS
Balance de
verification to 277 200Clientes$ 518
CuentaDebeHaberBancos$
December
000Suministros$ 8 400Mobiliario 31 140 000Depreciación
infantil$
from 200X
mobiliario$ 56 000Local$ 350 000Depreciación acumulada local$
182 000Acreedores diversos$ 532 000Salario por pagar$-Anticipo
clientes$ 63 000Capital social$410 200Pérdidas acumuladas$ 91
000Ingresos por servicios$ 400 400Gasto por salarios$ 240
800 Expense supplies

continue
úa)
 140 CHAPTER 4 Adjustments

(continu
action Gasto por depreciación mobiliarioGasto por depreciación
localGastos varios$ 18 200$ 1 643 600S 1 643 600

If pide:
Elabora los asientos de ajuste para Kids Circus, al 31 de diciembre, considerando la
next additional information:
a)The value of supplies as of December 31 is $2,800.
b) The depreciation of children's furniture for the period is $28,000 and
it is not yet recorded.
c)The depreciation of the property for the period is $14,000 and it has not yet been
has registered.
d)The salaries for the period that are pending payment and registration amount to $7.
000.
e) The amount of income from services performed during the period that do not
It has neither been charged nor recorded is $18,000.
f) From the account of advances to customers for $63,000, a total of services for
$44,800 has already been provided to the client.

8. With the information from the previous problem, the following is requested:
a) Describe the analysis in the accounting equation for each of the entries.
adjustment: increases and/or decreases in the accounts of assets, liabilities, and equity.
b)For capital increases and/or decreases, indicate whether it is about accounts
of income or expenses.
c)Make the transfers to the major (starting from the balances of the trial balance)
unadjusted check.
d)Prepare the adjusted trial balance as of December 31.

9."Pintarte", a business that offers exterior painting services for houses and offices,
show the unadjusted trial balance as of December 31, as well as the
adjustment seats made.
PAINTING YOU
Scale of
check at
December 31142 800Materiales de pintura$21
CuentaDebeHaberBancos$19320Clientes$
from 200X diversos$12600Anticipos de clientes$
840Equipo de transporte$ 334 320Acreedores
33 600Capital social$ 453 600Dividendos$16800Ingreso por servicios$617400Gasto
por sueldos$ 338 520Gasto por renta$165480Gasto por servicios$ 63 000Gastos
various $15 120 $ 1 117 200 $ 1 117 200

$18 060
a) Expenditure on paint materials $18 060
Materiales de pintura
 Complementary problems 141
b) Clients $21,000

Income from services $21 000 $19

c) Depreciation expense for transportation equipment

$19,200. Accumulated depreciation of transportation equipment 200 $4 560 $8

d)Expense for salaries $4

560 400

Salaries payable
e) Customer advances $8
400
Income from services

It is requested:

a)Analyze and describe the transaction that originated each of the recorded adjustments.
b)Make the entries to the ledger (considering the balances of the trial balance)
before adjustments).
c)Prepare the adjusted trial balance as of December 31, 20X1.

10. The company 'Arreglatodo', dedicated to clothing repair, has the following unadjusted trial balance as of December 31, 20X1:
The adjustments made at the end of the period were the following:

a) Depreciation expense for premises $10 800

Balance of
verification
Fixit all by the 31st
CuentaDebeHaberBancos$ 12 of December
600Clientes$ 61 800Seguro pag. por
200X de composturas$ 4 350Terreno$
anticipado$ 18 000Materiales
600 000Local$ 484 500Dep. acum. local$ 227 100Equipo$ 240
300 Dep. now. equipment $ 105 900 Various creditors S 22
500Anticipos de clientes$ 21 600Capital social$ 471
300Dividendos$ 15 000Ingreso por servicios$ 1 071 600Gasto por
sueldos$ 305 400Gasto por servicios públicos$ 84 600Gasto por
publicidad$ 45 000Gasto por reparaciones$ 36 300Gastos varios$
12 150$ 1 920 000$ 1 920 000

Accumulated depreciation of premises $10 800

b) Depreciation expense of equipment $7,200

Accumulated depreciation of equipment $7 200
 1842 CHAPTER 4 Adjustments

142 CHAPTER 4 ADJUSTMENTS

c) Expense for salaries $6 510

Salaries payable S6 510

d) Insurance expense $7,500

Insurance paid in advance $7 500
e) Clients $13 050
Income from services $13 050
Expense for repair materials $3 225
Repair materials $3,225
g) Customer advance $8 400

Income from services $8 400

It is requested:

a) Analyze and describe the transaction that originated each of the recorded adjustments.
b) Make the entries to the ledger (considering the balances of the trial balance not
adjusted).
c) Prepare the adjusted trial balance as of December 31, 200X.

11. "Virtual World", a company dedicated to providing computing services, shows the following
unadjusted trial balance as of June 30, 200X:

Scale of
verificationat
June30
200X
Count Should News
Banks ______________________________________________$ 23,370____________________________
Clients $28,500
Materials $ 6,840
Computer equipment 1,440,20
Accumulated depreciation of computer equipment

Various creditors $6,650

Customer advances $7,600
Social capital $100,000
Retained earnings 27,800
Dividends $15,700
Income from services $ 171950
Expense for salaries $ 39 900
Rent expense $ 30 400
Expense for services $21,850
Miscellaneous expenses $ 3 420
Expense by computer equipment department

Expenses for materials

314,000dollars $314,000

The company prepares its financial statements monthly and has the following information.
to make the adjustment entries as of June 30:
a) A total of services accrued by June 30 amounting to $6,080, which have not yet been
registered nor have they been charged.
The value of materials available as of June 30 has decreased to $1,919.
ADDITIONAL PROBLEMS 143

c) The annual depreciation amount of the computer equipment is $7,315. It has not yet been
depreciation corresponding to the month of June has been recorded.
d) The balance of customer advances corresponds to what was received on June 1 for services.
that will be provided during the months of June and July, of which only services have been provided
for $1,900 during the month of June.
The accumulated salaries in June that have not been paid amount to $1,558.

Based on the above information, prepare:

a) The adjusting entries for the month of June.
b) Wholesaler passes.
c) The adjusted trial balance as of June 30.

12. The company 'Publicity' presents the following unadjusted trial balance as of May 31st.
200X:
The company prepares its financial statements monthly.

PUBLICITY
Trial balance
as of May 31, 200X

CuentaDebeHaberBancos$ 22 000 Clientes$ 92 750 Materiales$ 7 250 Documentos por

cobrar$ 32 000 Renta pagada por anticipado$ 9 000 Deudores diversos15 600 Equipo de
oficina$ 154 000 Dep. acumulada equipo de oficina$ 10 400 Acreedores diversos$ 43 200
Sueldos por pagar Anticipo de clientes$ 78 000 Capital social$ 150 000 Utilidades retenidasS
1 1 070 Ingreso por servicios$ 119 450 Gasto por sueldos$ 60 900 Gasto por renta Gasto
por servicios públicos$ 13 620 Gasto por publicidad$ 5 000 Gasto por depreciación de equipo
Expense for materials $412 120 $412 120

The following is additional information that should be taken into account for the preparation of the adjustments.
corresponding to the end of May:

a) Hay un total de ingresos no registrados ni cobrados al 31 de mayo por $2 650.

The consumption of materials during the month of May has not been recognized for a total of $1,860.
c) The balance of the rent paid in advance represents the amount of the rent.
corresponding to the month of May.
d) The annual depreciation amount of the equipment is $3,150. It has not yet been recorded.
depreciation for the month of May.
144 CHAPTER 4 ADJUSTMENTS

a) The customer advance balance as of May 31 has decreased to $3,275.

b) There are accumulated wages from May that have not been paid as of May 31 for $3,680 that have not yet been made.
registered.

It is requested:

a) Prepare the adjusting entries corresponding to May 31.

b) Make the passes to the majority.
c) Prepare the adjusted trial balance as of May 31, 200X.

13. The company Clean Fast, which provides furniture cleaning services, shows the unadjusted trial balance.
as of December 31, 20X1, the end of its accounting period.
The company prepares its financial statements annually and some transactions have been detected that have not been
CLEAN FAST
Scale of
CuentaDebeHaberBancosS 51 verification at
900 Clientes$ 68 260 Materiales de
December 31
limpieza$ 19 440 Seg. pagado por adelantado$ 4 800 Equipo de
from 20X1
cleaning$ 52,000 Accumulated depreciation cleaning equipment Equipment of
transport $280,000 Accumulated depreciation transportation equipment
Various creditors $13,960 Salaries payable Advances of
clientes$ 16000 Crédito bancario$ 125 000 Capital social$ 160
000 Accumulated losses $ 41,200 Income from services
cleaning$ 260 200 Expense for equipment depreciation cleaning
Gasto por sueldos$ 32 800 Gasto por publicidad$ 8 500 Gasto
for sure Expense for rent $12,000 Expense for materials of
limpieza Gastos varios$4 260$ 575 160$ 575 160

registered and corresponding to the year 20X1:

a)The annual insurance expense of $2,400 that was paid in advance.

b) The materials used during the period for $2,100.
c) The depreciation expense for the cleaning equipment, which was purchased in early February and is
it is estimated to have a duration of 10 years with no redemption value.
d) The depreciation expense of the transportation equipment purchased on March 15 is estimated to last
five years and at the end of them it could be sold for $75,000.
e) The cleaning services provided during the year, which were charged in advance and that
they total $4,000.
 a) The salaries for the last week of the year of $1,420 that have not been paid.

b) The cleaning services for $3,600 that were performed at the end of December and will be charged until
next year.
c) The rent for the month of December for $10,000 that has not been paid.

i) The interest on the bank loan received on October 15 at an annual interest rate of 13% and that
they will pay when the credit is settled.

If request:
Based on the previous information, elaborate the following:
a) The adjusting entries for the year 200X.
b) The wholesale passes.
c) The adjusted trial balance as of December 31.

[Link] SPA prepared the following trial balance before adjustments as of July 31, 200X:

COMFORT SPA
Trial balance as of 31
of July 200X
Count Must News

Banks
$ 88 000
Clients $ 51 000
Materials $ 13 000
Rent paid in advance $36,000
Team $216,000
Accumulated depreciation equipment

Various creditors $ 12 800

Salaries to be paid

Bank credit $ 135 0

Client anticipation
$32,000

Social capital
$ 83 400

Retained earnings
$ 388 140

Income from services

Expense for salaries $243,000

Rent expense

Depreciation expense

gastro material

Electricity expense

Phoneexpense

Advertising expenditure $ 1,240

Various expenses $3,100
$651,340 $ 651340
Ifyou have the following data to prepare the adjusting entries as of July 31:
a) There are earned revenues in July that have not been collected as of July 31, totaling $10,600.
b) Materials were consumed during the month of July for $4,370.
c) Of the rent paid in advance, $18,000 corresponds to the month of July
d) The annual depreciation of the equipment is $12,600.
e) From the client advances as of July 31, services worth $13,100 have already been provided.
f) There are accumulated and unpaid salaries as of July 31 amounting to $14,720, all corresponding to the month of
july.
 g) The electricity and phone bills for the month of July were $1,580 and $1,395, respectively, which will be
paid in August. These items are not yet recognized.

Based on the previous information, do the following:

a) The corresponding adjustment entries.
b) The wholesale passes (T accounts).
c) The adjusted trial balance as of July 31.

15. Below is the trial balance of Secure Messaging, S.A., package and messaging services,
as of September 30, 200X:
Additional information is provided to make the adjustment entries as of September 30:

SECURE MESSAGING
S.A
Trial balance
CuentaDebeHaber Bancos$ 26 764 Clients $199,920 Temporary investments $210,000
Materials $30,576 Delivery team $468,900 Depr. now. team rep. $21,958 Creditors
various $17,640 Customer advances $25,082 Share capital $300,000 Utilities
retenidas$227 330 Dividendos$ 23 500 Ingreso por servicios$ 864 360 Gasto por sueldos$
351 500 Gasto por renta$ 20 000 Gasto por servicios$ 88 200 Gastos por combustible$ 15
700 Gastos varios$ 21 310$ 1 456 370$ 1 456 370

a)Los materiales disponibles al 30 de septiembre suman $ 12 965. Falta actualizar la cuenta de materiales.
b)The accumulated income from services for the month of September and pending collection totals $26,800. Still
they are not registered.

c) The depreciation for the month of the delivery equipment has not been recorded. The equipment has a useful life of seven.
years and a salvage value of 100,000 is estimated.
d)The unpaid salaries for the period amount to $18,000.
e)Of the customer advances, services worth $8,000 have already been performed.
f)The monthly taxes are $16,700 and will be paid in October. They have not been recorded yet.
g)The advertising for the last week of September cost $1,700, which will be paid on the 5th of
October and it has not been recognized.

Given the above information, do the following:

a) The adjustment entries for the month of September.
b) The wholesale passes (T accounts).
c)The adjusted trial balance as of September 30.