For Each of the Following Transactions,match the Action (Debit or Credit)and

question 7

Essay

For each of the following transactions,match the action (Debit or Credit)and the account type (Asset,Liability,Revenue,or Expense)to each account for the appropriate adjustment that needs to be made at the end of June.Also,show the effect on Retained Earnings.
(D)Debit or (C)Credit
(A)Asset,(L)Liability,(R)Revenue or (E)Expense Account
Increase or Decrease Retained Earnings
a.The company has insurance costs of $620 a day for the month of June.On June 1 the company had $26,000 of prepaid insurance.
$$\begin{array} { | r | r | r | r | } \hline \text { Irsurarice expense: Action (D or C) } & - & \text { Accourt Tye } ( A , L , R , \text { or E) } & \\\hline \text { Prepaid irsurarice: Action (D or } \mathrm { C } ) & - & \text { Accourt Tye } \left( \mathrm { A } , \mathrm { L } _ { 2 } \mathrm { R } , \right. \text { or E) } & \\\hline \text { Effect on Retained earings: } & - & & \\\hline\end{array}$$
b.The company provides services in June for which it had received payment of $18,300 in May.
$$\begin{array} { | r | r | r | r | } \hline \text { Irsurarice expense: Action (D or C) } & - & \text { Accourt Tye } ( A , L , R , \text { or E) } & \\\hline \text { Prepaid irsurarice: Action (D or } \mathrm { C } ) & - & \text { Accourt Tye } \left( \mathrm { A } , \mathrm { L } _ { 2 } \mathrm { R } , \right. \text { or E) } & \\\hline \text { Effect on Retained earings: } & - & & \\\hline\end{array}$$
c.The company had $12,500 worth of labour performed by workers who will be paid in July.
$$\begin{array} { | r | r | r | r | } \hline \text { Wages experse: Action (D or C) } & - & \text { Accourt Type } ( A , I , R , \text { or } E ) & - \\\hline \text { Wages payable: Action (D or C) } & - & \text { Accourt Type } ( A , L , R , \text { or } E ) & - \\\hline \text { Effect on Retaired earings: } & - & & \\\hline\end{array}$$ d.The company had income before income taxes of $287,400 for June and will pay taxes at the rate of 36%.The tax will be paid in July.
$$\begin{array} { | r | r | r | r | } \hline \text { Income tax experse: Action (D or C) } & - \text { Account Type } ( A , L , R , \text { or E } ) & - \\\hline \text { Irucorne tax payable: Action (D } \mathrm { C } ) & - & \text { Account Type } ( A , L , R , \text { or E) } & \\\hline \text { Effect on Retained earings: } & - & & - \\\hline\end{array}$$ e.The company had interest of $1,000 due for June on a Certificate of Deposit (CD).The interest will be received in August.
$$\begin{array} { | r | r | r | r | } \hline \text { Irterest receivable: Action (D or C) } & - & \text { Accourt Type } ( A , I , R , \text { or E) } & \\\hline \text { Irterestreverue: Action (D or C) } & - & \text { Accourt Type } ( A , L , R , \text { or E) } & \\\hline \text { Effect on Retained earrings: } & - & & \\\hline\end{array}$$

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Definitions:

Fire Extinguishers

Portable devices used to extinguish small fires by discharging a substance that cools the burning material, deprives the flame of oxygen, or interferes with the chemical reactions occurring in the flame.

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Stands for Vehicle Identification Number, a unique code used to identify individual motor vehicles.

Transmission Ratio

The ratio between the rotational speeds of two connected parts in a transmission system.

MSDS Sheet

Material Safety Data Sheet, a document that provides safety and health information regarding chemicals, compound materials, and mixtures.