Debit. Service Supplies Expense is debited for $900. Depr.—Equip. The total amount of invoice including expenses and Taxes was 25000$ which has to be paid on or before Apr’01, 2019. The initial journal entry for a prepaid expense does not affect a company’s financial statements. The balance in income summary now represents $37,100 credit – $28,010 debit or $9,090 credit balance…does that number seem familiar? Cash account will be credited, as cash is going out of the business. You will need to debit your expense account because expenses increase with debits. Transcribed image text: The payment for utilities of the current month would be recorded as 9 Multiple Choice 8 01:17:35 Debit Cash; Credit Utilities Payable. Let’s say you have a $2,500 rent expense. Revenue and expense accounts are referred to as temporary or nominal accounts because each period they are closed out to Income Summary in the closing process. DEBIT CREDIT 1 Feb 29 Utilities Expense 3,800 2 Utilities Payable 3,800 3 To accrue the cost of electricity incurred for the month of February. Jason Taylor, Cap. Click to see full answer . And, you will credit your accounts receivable account to show you no longer expect a payment. And, you will credit your accounts receivable account to show you no longer expect a payment. Sales Revenue B. Maintenance and repairs expense is 100% administrative. DECREASE DECREASE DEBIT ASSET LIABILITY DEBIT EXPENSE REVENUE CREDIT LIABILITY ASSET CREDIT REVENUE EXPENSE. [Equation 3] Assets + Expenses = Liabilities + Equity + Revenues. It means expenses that are owing or payable. A Balance Sheet lists the assets (cash, accounts receivable, fixed assets) and liabilities/equity of a company (credit cards, loans payable) as of a particular date. Credit Cash: Your first journal entry will debit the appropriate expense account (e.g., Payroll, Mortgage Interest, Rent, or Utility). Paid utility bill $1,200. ... Wages account will be debited according to the rule of “Debit all expenses”. At this point, you have closed the revenue and expense accounts into income summary. Utility expense is a sub-account of the expense account on the income statement. Exp.—Equip. Sage Business Cloud Accounting. Expense accounts receive their debits mostly from two respective journals. The credit entry to accounts payable reflects the liability of the business to pay the electricity supplier for the amount of service consumed during the period. Fees Income Salaries Expense Utilities Expense Supplies Expense Rent Expense Depr. Transaction (d): Delivery Expense (debit), Cash (credit). 3. Debit Credit Balance May 31 31 Balance Adjusting J1 750 3,300 4,050 Utilities Expense No. Interest Revenue b. Every entry consists of a debit and a credit. A business receives its monthly electric utility bill in the amount of $550. “Debit” cards may be used to buy goods. Accounts Payable Jason Taylor, Draw. Debit. Unequal debits and credits are a good indication that there is a mistake in your records. Retained earnings 7. D. debit Accounts Payable and credit Utilities Expense. $300. Cash Asset Increasing Debit 5,200 Accounts Receivable Asset Decreasing Credit 5,200 28 Paid the employee wages, $6,700. This preview shows page 23 - 34 out of 34 pages.. √ 4,770 ACCOUNT Utilities Expense ACCOUNT NO 513 2020 ITEM DEBIT CREDIT BALANCE DATE DEBIT CREDIT Nov. 30 Bal. And, you’ll credit your regular banking account (e.g., Checking), which is an asset account. When recording a transaction, every debit entry must have a corresponding credit entry for the same dollar amount, or vice-versa. Debit. A business receives its monthly electric utility bill in the amount of $550. However, this isn’t always the case. Credit entries equal to the proceeds from the utility’s insurance covering such events. When a company receives a utility bill but will not pay it right away, it should: A. make no entry until the bill is paid. When recording a transaction, every debit entry must have a corresponding credit entry for the same dollar amount, or vice-versa. Debits increase asset or expense accounts and decrease liability, revenue or equity accounts. The initial journal entry for prepaid rent is a debit to prepaid rent and a credit to cash. You will debit the utilities expense account and credit accounts payable. Centurion Co. had the following accounts and balances at December 31:AccountDebit CreditCash$10,000 Accounts Receivable 2,000 Prepaid Insurance 2,400 Supplies 1,000 Accounts Payable $5,000 Common Stock 4,900 Service Revenue 7,000 Salaries Expense 500 Utilities Expense 1,000 Totals$16,900 $16,900 Using the information in the table, calculate the company's reported net … Utilities expense 8. The journal entry to recognize accrued expenses is followed by a debit to the expense account and credit to the accrued expense account. Instructions a. Journalize the adjusting entries. Salary a/c, Rent a/c, Commission paid a/c etc., are a few most common examples of expense accounts. A bad debt expense is a non-cash expense account that shows your loss. Revised Fall 2012 Page 12 of 19 2519, listed with the canceled checks, was correctly drawn for $805 in payment of a utility bill on December 16. On issuance of the vendor invoice, a corresponding debit entry would go either into the asset account or an expense account. Accrued expenses is a liability account . The adjusting entry for Supplies in general journal format is: Date Account Name Debit Credit. b. debit Utilities Expense and credit Accounts Payable. That's what keeps the entry in balance. A credit of $3300 will need to be. b. Hence, accrued expenses have a credit nature. If the utility bills for December's usage are not available at the time that the retailer's financial statements are prepared, the retailer will record an accrual adjusting entry that debits Utilities Expense and credits Accrued Utilities Payable for December's estimated amount. So before answering, let's make sure we really understand what accrued expenses are. If you are unsure of what this is referring to here, then please read Lesson 3 explaining ledgers and journals. November 30, 2018. accta. Asset (A), Liability (L), a. Required: Indicate whether the normal balance of each account is a debit or a credit. T Accounts Explained. (Being Wages paid). This is posted to the Utility Expense T-account on the debit side. Income statement account is Supplies Expense. √ 6,725 ACCOUNT Miscellaneous Expense ACCOUNT NO 525 2020 ITEM DEBIT CREDIT BALANCE DATE DEBIT CREDIT Nov. 30 Bal. Incurred utilities expenses. 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