ADJUSTING ENTRIES EXPLAINED, ACC 100 Accounting I Week 3 Homework Chapter 3, homework help

ADJUSTING ENTRIES ARE OF FOUR TYPES

Prepaid Expense

  Prepaid Expense (or Inventory)   dr 

  Cash  cr

When the Prepaid Expenditure is made.

  AND/OR

Expense  dr

Prepaid Expense (or Inventroy)  cr

When the actual expense consumed is determined (usually at the end of a period.)

UNEARNED REVENUE

Cash dr

Unearned revenue  cr

When a cash payment for unearned revenue is received.

  and/or

Unearned revenue  dr

Revenue  cr

When the revenue is considered to have been earned

ACCRUED REVENUE

Accounts receivable  dr

Revenue  cr

When a sale has occurred but cash has not been received from the customer

ACCRUED EXPENSE

XXX  Expense  dr

xxx Payable  cr

When an expense has been incurred but not paid for.