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Auditing Problems 1

The document contains two practice problems with adjusting journal entries for different years. Practice problem 1 shows adjusting entries made in 2020, 2021, and 2022 related to purchases, accounts receivable, sales, and merchandise inventory. Practice problem 2 shows adjusting entries made related to prepaid insurance, cost of sales, sales commissions payable, insurance expense, merchandise inventory, depreciation expense, and equipment.

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czymon
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28 views4 pages

Auditing Problems 1

The document contains two practice problems with adjusting journal entries for different years. Practice problem 1 shows adjusting entries made in 2020, 2021, and 2022 related to purchases, accounts receivable, sales, and merchandise inventory. Practice problem 2 shows adjusting entries made related to prepaid insurance, cost of sales, sales commissions payable, insurance expense, merchandise inventory, depreciation expense, and equipment.

Uploaded by

czymon
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd
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PRACTICE PROBLEM NO.

1
Adjusting Entries 2020
1 Purchases 60,000
Accounts Payable

2 Accounts Receivable 80,000


Sales

3 Cost of Sales 20,000


Merchandise Inventory

Adjusting Entries 2021


1 Retained Earnings 60,000
Purchases

2 Sales 80,000
Retained Earnings

3 Retained Earnings 20,000


Merchandise Inventory

Adjusting Entries 2022


1 No Entry

2 No Entry

3 No Entry

PRACTICE PROBLEM NO. 2


1 Prepaid Insurance 28,000
Retained Earnings

Insurance Expense 7,000


Prepaid Insurance

2 Cost of Sales 25,000


Mechandise Inventory
3 Sales Commission Expense 15,500
Sales Commission Payable

4 No Entry

5 Equipment 100,000
Depreciation Expense 10,000
Accumulated Depreciation
Retained Earnings
60,000

80,000

20,000

60,000

80,000

20,000

Acquired at the beginning of 2020, 1 year expired


28,000

Insurance expense for 2021


7,000

25,000
15,500

20,000
90,000

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