|Accounting I||© 2008 Tibebe S. Mengistu|
ABC Company, a retail hardware store, pays quarterly rent on its store at the beginning of each
quarter. The rent per quarter
By using the balance sheet equation format (Asset = Liability + Equity), analyze the effects of the
following on the tenant's
Delta Airlines had the following as a current liability on its balance sheet, Dec 31, 20X7:
Accrued salaries and vacation pay $1,170,000,000
Under the accrual basis of accounting, vacation pay is ordinarily accrued throughout the year as
workers are regularly paid.
1. Prepare the weekly Delta adjusting journal entry called for by the $32 example.
ABC Bank lent XYZ Company $1,000,000 on April 1, 20X1. The loan plus interest of 12% is payable on April 1, 20X2.
1. By using the balance sheet equation format (Asset = Liability + Equity), prepare an analysis of the impact of the
transaction on both ABC Bank and XYZ's financial position on April 1, 20X1. Show the summary adjustments on December 31, 20X1,
for the period April to December 31.
2. Prepare adjusting journal entries for ABC Bank and XYZ Company on December 31, 20X1.