35) Mac, Inc. purchased equipment on December 1, 2011 in exchange for a 4-month, 9%, $120,000 note. The equipment has an estimated useful life of four years and $0 residual value. Record (a) the purchase of the equipment December 1, 2011 and the adjusting entries for (b) straight-line depreciation and (c) interest for the month-ended December 31, 2011 in the T-accounts provided.
Equipment
Notes payable
Depreciation expense
Accumulated depreciation
Interest payable
Interest expense
36) MT Pockets, Inc.'s unadjusted trial balance and additional information are below:
MT Pockets, Inc.
Unadjusted Trial Balance
December 31, 2011
|
Debit
|
Credit
|
Cash
|
$ 40,000
|
|
Accounts receivable
|
30,000
|
|
Truck
|
120,000
|
|
Accumulated depreciation
|
|
$ 0
|
Note payable
|
|
60,000
|
Interest payable
|
|
0
|
Salary payable
|
|
0
|
Common stock
|
|
90,000
|
Service revenue
|
|
100,000
|
Interest expense
|
0
|
|
Salary expense
|
60,000
|
|
Depreciation expense
|
0
|
|
Totals
|
$250,000
|
$250,000
|
The truck was purchased on January 1, 2011 and has an estimated useful life of ten years and $0 residual value. MT Pockets uses straight-line depreciation. The $60,000, 6%, two-year note was issued on February 1, 2011. On December 31, 2011, MT Pockets owes its employee $10,000, which will be paid in January 2012.
A. Record MT Pockets' year-end adjusting journal entries using the information above.
Date
|
Transaction
|
Debit
|
Credit
|
12/31/11
_________________________________________________________
12/31/11
_________________________________________________________
12/31/11
B. Using the information MT's Unadjusted Trial Balance, prepare MT Pockets' adjusted trial balance.
MT Pockets, Inc.
Adjusted Trial Balance
December 31, 2011
|
Debit
|
Credit
|
Cash
|
|
|
Accounts receivable
|
|
|
Truck
|
|
|
Accumulated depreciation
|
|
|
Note payable
|
|
|
Interest payable
|
|
|
Salary payable
|
|
|
Common stock
|
|
|
Service revenue
|
|
|
Salary expense
|
|
|
Interest expense
|
|
|
Depreciation expense
|
|
|
Totals
|
|
|