The Balances of the Ledger Accounts for Lance's Landscaping Design

question 14

Essay

The balances of the ledger accounts for Lance's Landscaping Design on March 31, 2013, and the information needed for adjustments are shown below. Prepare the Trial Balance section, record the adjustments, and complete the worksheet. Adjustment information:
(a) The supplies were purchased on March 1, 2013. An inventory of supplies showed $300 on hand on March 31, 2013.
(b) The amount of Prepaid Insurance represents a payment made March 1, 2013, for a six-month insurance policy.
(c) The equipment, purchased March 1, 2013, has an estimated useful life of 5 years with no salvage value. The firm uses the straight-line method of depreciation.

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Definitions:

Insurance Policies

Contracts between an insurer and an insured that provides financial protection or reimbursement against losses.

Total Gross Pay

The complete amount of income earned by an employee before any deductions or taxes are applied.

Commission

A fee paid to an agent or employee for transacting a piece of business or performing a service, often a percentage of the sale.

Net Proceeds

The amount of money received from a sale after subtracting costs and expenses.