Andy Wright, D.D.S., opened a dental practice on January 1, 2008. During the first month of operations the following transactions occurred.

Performed services for patients who had dental plan insurance. At January 31, $875 of such services was earned but not yet recorded.
Utility expenses incurred but not paid prior to January 31 totaled $520.
Purchased dental equipment on January 1 for $80,000, paying $20,000 in cash and signing a $60,000, 3-year note payable. The equipment depreciates $400 per month. Interest is $500 per month.
Purchased a one-year malpractice insurance policy on January 1 for $12,000.
Purchased $1,600 of dental supplies. On January 31, determined that $400 of supplies were on hand.
Instructions

Prepare the adjusting entries on January 31.

Date Description/Account Debit Credit
1. Jan.31 Accounts Receivable 875
Service Revenue 875
2. Jan. 31 Utilities Expense 520
Utilities Payable 520
3. Jan. 31 Depreciation Expense 400
Accum. Deprec.-Dental Equipment 400
(To record depreciation.)
Jan. 31 Interest Expense 500
Interest Payable 500
4. Jan. 31 Insurance Expense
Prepaid Insurance
5. Jan. 31 Supplies Expense
Supplies

How do i do this stuff

E3-8

Andy Wright, D.D.S., opened a dental practice on January 1, 2010. During the first month of operations the following transactions occurred.

1. Performed services for patients who had dental plan insurance. At January 31, $875 of such services was earned but not yet recorded.
2. Utility expenses incurred but not paid prior to January 31 totaled $520.
3. Purchased dental equipment on January 1 for $80,000, paying $20,000 in cash and signing a $60,000, 3-year note payable. The equipment depreciates $400 per month. Interest is $500 per month.
4. Purchased a one-year malpractice insurance policy on January 1 for $12,000.
5. Purchased $1,600 of dental supplies. On January 31, determined that $400 of supplies were on hand.
Instructions
Prepare the adjusting entries on January 31. Account titles are: Accumulated Depreciation—Dental Equipment, Depreciation Expense, Service Revenue, Accounts Receivable, Insurance Expense, Interest Expense, Interest Payable, Prepaid Insurance, Supplies, Supplies Expense, Utilities Expense, and Utilities Payable.

To prepare the adjusting entries on January 31, follow these steps:

1. Accounts Receivable and Service Revenue:
- Debit the Accounts Receivable account for $875.
- Credit the Service Revenue account for $875.

2. Utilities Expense and Utilities Payable:
- Debit the Utilities Expense account for $520.
- Credit the Utilities Payable account for $520.

3. Depreciation Expense and Accumulated Depreciation - Dental Equipment:
- Debit the Depreciation Expense account for $400.
- Credit the Accumulated Depreciation - Dental Equipment account for $400. (To record depreciation.)

4. Interest Expense and Interest Payable:
- Debit the Interest Expense account for $500.
- Credit the Interest Payable account for $500.

5. Insurance Expense and Prepaid Insurance:
- Debit the Insurance Expense account for $12,000. (To allocate the insurance expense over the year)
- Credit the Prepaid Insurance account for $12,000.

6. Supplies Expense and Supplies:
- Debit the Supplies Expense account for $1,200. ($1,600 - $400)
- Credit the Supplies account for $1,200.

Remember to allocate the insurance expense over the year and to calculate depreciation for the month.

To prepare the adjusting entries on January 31, follow these steps:

1. For the first entry:
- Debit the "Accounts Receivable" account by $875, as services worth that amount were earned but not yet recorded.
- Credit the "Service Revenue" account by $875 to record the revenue earned.

2. For the second entry:
- Debit the "Utilities Expense" account by $520, which represents the utility expenses incurred but not yet paid.
- Credit the "Utilities Payable" account by $520 to record the amount payable for the utility expenses.

3. For the third entry:
- Debit the "Depreciation Expense" account by $400 to record the monthly depreciation of the dental equipment.
- Credit the "Accumulated Depreciation - Dental Equipment" account by $400 to accumulate the depreciation.

4. For the fourth entry:
- Debit the "Insurance Expense" account for the cost of the one-year malpractice insurance policy (amount not mentioned in the question).
- Credit the "Prepaid Insurance" account to adjust the prepaid amount for the remaining insurance period.

5. For the fifth entry:
- Debit the "Supplies Expense" account for the amount of supplies used during the period (amount not mentioned in the question).
- Credit the "Supplies" account by the same amount to reduce the supplies on hand.

It is important to note that certain amounts and specific accounts are not mentioned or provided in the question, such as the insurance expense and supplies expense. You may need additional information or assumptions to complete the entries accurately.