Adjusting Journal Entries

Prepaid Expenses:
Transaction Description Journal Entry Account Title Debit Credit

Supplies: Beginning supplies plus any purchases minus supplies on hand Insurance: Original cost divided by number of months paid for

Supplies Expense Supplies Insurance Expense Prepaid Insurance

XXX XXX XXX XXX

Depreciation Expense XXX Depreciation: Based on type of depreciation method used Accumulated Depreciation-Asset title XXX You pay for in advance of usage these assets. Each is divided by the period in which the asset will be used up.

Unearned Revenues:
Transaction Description Journal Entry Account Title Debit Credit

XXX Advance payments: Accounting for any Unearned Service Revenue amount earned during the fiscal period Service Revenue XXX Other types of revenue accounts could be titled: Unearned Sales Revenue, Unearned Subscription Revenue, and Unearned Ticket Revenues. The number of products or services sold only limits the possibilities for account titles.

Accrued Revenues:
Transaction Description Journal Entry Account Title Debit Credit

Revenues earned but not yet billed at the Accounts Receivable end of the fiscal period Service Revenue

XXX XXX

Accrued Expenses:
Transaction Description Accrued Interest: Expense incurred but not yet due to be paid Accrued Salaries: Salaries earned but not due to be paid until next payday occurs Journal Entry Account Title Interest Expense Interest Payable Salaries Expense Salaries Payable Debit XXX Credit XXX XXX XXX

MJC Revised 10-2011

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