Adjustment Entries

A business has incorrectly recorded all its supplies as Supply Expenses at the time of buying. It had bought Rs 30,000 of supplies. At the end of the year it discovers that it still has supplies worth Rs 10,000 worth in stock. How should it record the Supplies at the end of the year

• Suppy Expenses Debit Rs 10,000 Supplies Credit Rs 10,000
• Supplies Debit Rs 10,000 Supply Expenses Credit Rs 10,000
• Supplies Debit Rs 20,000 Supply Expenses Credit Rs 20,000
• Suppy Expenses Debit Rs 20,000 Supplies Credit Rs 20,000

A business has paid an Insurance premium of Rs 32,000 for 1 year on 1st Jan of the current year. At the time of payment the Prepaid Insurance Account was Debited. What should the adjusting entry be on 31st march with respect to the Insurance while closing the financial year accounts.

• Prepaid Insurance Account Debit Rs 32,000 To Insuarance Expense Account Credit Rs 32,000
• Prepaid Insurance Account Debit Rs 8,000 To Insuarance Expense Account Credit Rs 8,000
• Insurance Expense Account Debit 8,000 To Prepaid Insurance Account Credit Rs 8000
• Insurance Expense Account Debit 24,000 To Prepaid Insurance Account Credit Rs 24,000

Salary of Rs 25,000 Is due for the month of March. Prepare the adustment entry at the end of March if salary pay out would be done in April.

• Salary Expense A/c Debit Rs 25,000 To Salary Payable A/c Credit Rs 25,000
• Salary Payable Account Debit Rs 25,000 To Salary Expense Account Credit Rs 25,000
• Salary Expense A/c Debit Rs 25,000 To Cash Account Credit Rs 25,000
• Cash A/c Debit Rs. 25,000 To Salary Payable A/c Credit Rs. 25,000

A customer has paid rent advance of Rs 12,00,000 for 12 month on January 1st 2023. This advance was recorded as a prepaid at the time of payment. Please select the approppriate journal entry which should be passed at the time of closing the accounts on 31st March . No entry related to this transaction has been recorded by the business post 1st of January

• Prepaid Rent A/c Debit 12,00,000 To Cash A/c Credit 12,00,000
• Prepaid Rent A/c Debit 300,000 To Rent Expense A/c 300,000
• Rent Expense A/c Debit 3,00,000 To Prepaid Rent A/c Credit 300,000
• Prepaid Rent A/c Debit 900,000 To Rent Expense A/c 900,000

A customer has a mobile pre paid connection, she recharges her phone on 15th March with an amount of Rs 500. The mobile phone company had recorded this receipt as Deferred Revenue/Unearned Revenue. At the end of the month she has availed of services worth Rs 300 from the phone company, what entry should the phone company record for this transaction on 31st March.

• Services Revenue Debit 300 To Deferred Revenue Credit 300
• Services Revenue Debit 200 To Deferred Revenue Credit 200
• Deferred Revenue Debit 300 Services Revenue Credit 300
• Deferred Revenue Debit 200 Services Revenue Credit 200

A customer had a post paid connection with Jio. At the time of preparing the financial statements, the company estimated that Rs 600 worth services have been provided to the customer. Please select the most appropriate accounting entry to record this.

• Receivable Account Debit Rs 600 To Revenue Credit Rs 600
• Unbilled Revenue Debit Rs 600 To Revenue Credit Rs 600
• Revenue Debit Rs 600 Unbilled Revenue Credit Rs 600
• Revenue Debit Rs 600 Payables Credit Rs 600

The Company has bills payable outstanding of Rs 10,000 which were issued on 1st January of the current year. Interest of Rs 500 is applicable on the Bills for the current year. Record the entry for interest

• Interest Receivable Debit Rs 500 To Interest Income Credit Rs 500
• Bills Payable Debit Rs 500 To Interest Income Credit Rs 500
• Interest Expense Debit Rs 500 To Interest Payable Credit Rs 500
• Interest Income Debit Rs 500 To Interst Payable Credit Rs 500

The company has not provided for Electricity expenses for the year Rs 5000

• Electricity Expense A/c Debit Rs 5000 To Trade Payables Credit Rs 5000
• Trade Payable A/c Debit Rs 5000 To Electricity Expense Rs 5000
• Electricity Expense A/c Debit Rs 5000 To Cash Credit Rs 5000
• Electricity Expense A/c Debit Rs 5000 To Trade Receivable Credit Rs 5000

The shareholders are to be paid a dividend of Rs 10,000 for the year. Kindly select the appropriate provision entry

• Dividend A/c Debit Rs 10,000 To Cash A/c Credit Rs 10,000
• Dividend A/c Debit Rs 10,000 To Dividend Payable A/c Credit Rs 10,000
• Dividend Payable A/c Debit Rs 10,000 To Dividend A/c Credit Rs 10,000
• Dividend A/c Debit Rs 10,000 To Retained Earnings Credit Rs 10,000

Depreciation is to be provided on Furniture for Rs 3000

• Depreciation A/c Debit Rs 3000 To Accumulated Depreciation on Equipment Rs 3000
• Depreciation A/c Debit Rs 3000 To Accumulated Depreciation on Furniture Credit Rs 3000
• Depreciation A/c Debit Rs 3000 To Furniture A/c Credit Rs 3000
• Accumulated Depreciation on Furniture A/c Debit Rs 3000 To Depreciation Account Credit Rs 3000