Adjusting Entries-Effect on Elements of Financial Statements

question 90

Essay

Adjusting entries-effect on elements of financial statements
Whoop-It-Up,Inc.prepares monthly financial statements.On March 31,the company's accountant made adjusting entries to record:
(A)Depreciation for the month of March.
(B)Amount owed to Whoop-It-Up,Inc.for March from the concessionaire operating a juice bar in the facility.The amount due will be remitted to Whoop-It-Up,Inc during the first week in April.
(C)Cost of supplies used in March.(When purchased,the cost of supplies is debited to an asset account.)
(D)Earning of a portion of annual membership fees which had been collected in advance.(When customers purchase annual memberships,an Unearned Revenue account is credited.)
(E)Accrued interest for March owed on a bank loan obtained March 1.No interest expense has yet been recorded.
Indicate the effect of each of these adjusting entries on the major elements of the company's financial statements-that is,on revenue,expenses,net income,assets,liabilities,and owner's equity.Organize your answer in tabular form,using the column headings shown below and the symbols + for increase,- for decrease,and NE for no effect.

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Definitions:

Negligent

Failing to take proper care in doing something, resulting in damage or harm to another party.

Automobile

A wheeled motor vehicle used for transportation, typically fueled by gasoline, diesel, or electricity.

Negligence

The failure to exercise the care that a reasonably prudent person would exercise in like circumstances, leading to unintended harm or damage.

Unusual Circumstances

Situations that are not common or expected and often require special consideration or handling.