Q1. Has CASH Happen?

Q2.
No…. YES It’s a DEFERRAL!
Who is
Its an Q3.How was cash Recorded?
Paying
ACCRUAL Balance Sheet Income Statement
(4) Did this: (5) Did this: (6) Did this:
Nothing…. Assets 52 Expense 52
Cash 52 Cash 52
We
Pay So, now do So, now do this: So, now do this:
Them this: Expense 13 Assets 38
Expense 100 Assets 13 Expense 38
Liabilities
100
(2) Did this: (1) Did this: (3) Did this:
Nothing…. Cash 52 Cash 52
Liability 52 Revenue 52
They
Pay
So, now do So, now do this: So, now do this:
Us
this: Liabilities 13 Revenue 38
Assets 100 Revenue 13 Liabilities 38
Revenue 100

Example #1

F,Inc. received a $100 advance payment, increasing unearned revenue. Bu the

end of the year, 70%of the services has been performed. Adjusting entry please.

Cash Unearned Rev Revenu

Actual 100 100 0
Adjusting 70 70
30 70

Example #2

Earned Interest of $20 on our Bank certificate of deposit. certificate mature in

another three months.

Cash Interest Recv Intr Incom

Actual 0 0 0
Adjusting 20 20
20 20
Example #3

Cash revived from customer of $2300 was credited to a revenue account when
received. Of this amount $800 was earned by year-end.

Cash Unearned Rev Revenu

Actual 2,300 0 2,300
Adjusting 1500 1500
1500 800

Example #4

Wages of $170 were earned by the employee but ware not paid during the year.

Cash Wages Payed Wages Expe

Actual 0 0 0
Adjusting 170 170
170 170

Example #5

Supplies were purchased for $900, Increasing supplies, at year end, $400
supplies were on hand.

Cash Supplies Suppleis Expe

Actual 900 900 0
Adjusting 500 500
400 500

Example #6

A one year insurance policy was purchased for $2400, Increasing insurance
Expenses, Four months has passed since the purchase.

Cash Prep Insurance Insurance Exp

Actual 2,400 0 2400
Adjusting 1600 1600
1600 800