Module 4 – The Accounting Cycle – 2Lesson 1Adjusting the AccountsEXTENDName: _____________________________________ Time: _______________________Case 1: On October 1, 2007, Angie Aguilon, owner...

Module 4 – The Accounting Cycle – 2

Lesson 1

Adjusting the Accounts

EXTEND

Name: _____________________________________ Time: _______________________

Case 1: On October 1, 2007, Angie Aguilon, owner of Valencia Fitness Centre paid an advance rental on a space of the building it occupies in the amount of P60,000. This covers the period from October 1, 2007 to October 1, 2008 and the accounting period ends on December 31, 2007. Write your answers on the space provided.

Q1. If Asset Method or Real Approach is used in recording the prepayment, what is your journal entry on October 1, 2007?

Debit _________________________________

Credit_________________________________