Adjusting Entries-Effect on Elements of Financial Statements

question 87

Essay

Adjusting entries-effect on elements of financial statements
Galaxy Entertainment prepares monthly financial statements.On July 31,the accountant made adjusting entries to record:
(a. )Depreciation for the month of July.
(b. )The portion of prepaid rent for outdoor stage and seating which had expired in July.
(c. )Earning of ticket revenue for July which had been subscribed in advance.(When patrons purchase the Summer Jazz Series tickets in advance,the accountant credits Unearned Ticket Revenue. )
(d. )Amount owed to Galaxy from the caterer who sold food and beverages during the July performances.The amount due will be paid to the company on August 8.
(e. )Amount owed to the musicians which had accrued since the last payday in July.
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 owners' 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.