Adjusting enteries:
1. On august 1st, mr. borg borrowed $30,000 from a local bank on a 15 year mortage. The annual interest rate is 8%.
A telephone bill in the amount of $117 covering august charges is unpaid at august 31.
Although this is not my area of expertise, we do not know what you are asking. You give us some information, but you have not given a question about that information. Please give us specific questions, so we are better able to help you.
I hope this helps a little. Thanks for asking.
I am trying to write the adjusting enteries to both of the sentences provided.
To write the adjusting entries for the given scenario, we need to determine the appropriate accounts that need to be adjusted at the end of the accounting period. Based on the information provided, we can identify two potential adjusting entries:
1. Accrued Interest Expense:
Since Mr. Borg borrowed $30,000 on a 15-year mortgage with an 8% annual interest rate, we need to record the interest expense for the month of August. This entry recognizes the portion of interest expense that has accrued but has not yet been paid.
Adjusting Entry:
Debit: Interest Expense (Income Statement)
Credit: Accrued Interest Payable (Current Liability on the Balance Sheet)
2. Accrued Telephone Expense:
The telephone bill for August charges totaling $117 is unpaid at the end of August. To recognize this expense and the corresponding liability, we need to record accrued telephone expense.
Adjusting Entry:
Debit: Telephone Expense (Income Statement)
Credit: Accrued Telephone Payable (Current Liability on the Balance Sheet)
These adjusting entries ensure that expenses are recognized in the correct accounting period and that the corresponding liabilities are also recorded. It is important to note that the specific account names and classifications may vary depending on the chart of accounts used by the company.