From5 Accounting Question!!

用戶225630

2007-06-13 10:52 pm

Courtland Corp. has a year end as of December 31. Assume that the current year is 2007. On December 31, 2007, Courtland Corp. owed employees salaries of $2,100 because the employees worked the last seven days in December 2007. The next payroll date is January 4, 2008.

1. Over how many total annual accounting periods will this transaction directly affect the income statement of Courtland Corp.?

更新1:

2. By what amount would this $2,100 salary expense affect (increase of decrease) the income statement of Courtland Corp. for 2007 and the balance sheet as of December 31, 2007?

更新2:

3. Should Courtland Corp. make an adjusting entry on December 31, 2007? If so, prepare the adjusting entry. If not, explain why no entry is required.

回答 (1)

用戶4713

2007-06-14 6:12 am

✔ 最佳答案

1. Over how many total annual accounting periods will this transaction directly affect the income statement of Courtland Corp.?
affect income statement of $ 2,100 of expenses
Althought Courtland Corp was not paid 2100 until December 2007. However, accrual concept - transactions and events shall be dealt with in the financial statements of an entity when incurred, rather than when the cash is received or paid.

2. By what amount would this $2,100 salary expense affect (increase of decrease) the income statement of Courtland Corp. for 2007 and the balance sheet as of December 31, 2007?

It will affect income statement/ Balance sheet
Profit for the year will decrease $2,100
beacuse salary is a expenses( Administrative expenses)

Balances sheet of the retained profit will decrease $2100

3. Should Courtland Corp. make an adjusting entry on December 31, 2007? If so, prepare the adjusting entry. If not, explain why no entry is required.
Courtland corp should make an adjusting entry

The adjusting entry
DR salary 2100
CR Accured 2100

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