Super Clean Operates an Automatic Car Wash Business,The Ultimate Shine $$\begin{array} { l r } \text { Wages Expense } & \$ 82,000 \\\text { Rent Collected in Advance } & 8,000\end{array}$$

question 108

Essay

Super Clean operates an automatic car wash business,The Ultimate Shine.The following amounts were taken from the company's unadjusted trial balance at December 31,2017: $$\begin{array} { l r } \text { Wages Expense } & \$ 82,000 \\\text { Rent Collected in Advance } & 8,000\end{array}$$
Determine the effect on the accounting equation of any adjusting entries necessary at December 31,2017,for each of the transactions that follow:

A. The rent collected in advance represents rent for the period December 1,2017 , through January 31, 2018.

B. In addition to the wages pad during the year, employees have not been paid for the last week of December which amounts to $\$ 900$ .

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Definitions:

Edgeworth Box

A diagram used in economics to show the distribution of resources between two individuals, illustrating how trade can lead to an efficient allocation.

Pareto Optimal Allocations

A situation where resources in an economy are allocated in such a way that it is impossible to make any one individual better off without making at least one individual worse off.

Trade

The exchange of goods, services, or both between two or more parties.

Numeraire Good

An economic term referring to a benchmark commodity or asset used to compare the value of other goods or assets.