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Group 2 ACCT1501 Case 5B – Accrual Accounting Adjustments Fu, James, Mary, Reuben

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Topics Covered:Accrual Accounting AdjustmentsQuestions:1. Provide examples of accrual accounting adjustments 2. Explain each of the adjustments

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Group 2 ACCT1501Case 5B Accrual Accounting AdjustmentsFu, James, Mar, !eu"enGroup 2 ACCT1501#$at are Accrual Accounting Adjustments%Accrualadjustmentsist$eprocess"&$ic$ routineaccrualsareappliedtot$e'nancial statements(T$emaintpeso)adjustmentsare t$ee*pirationo)assets,unearnedre+enues, accrualo)unrecordede*pensesandaccrualo) unrecorded re+enues( Group 2 ACCT1501,uestions1( -ro+ide e*amples o) accrual accounting adjustments 2( .*plain eac$ o) t$e adjustmentsGroup 2 ACCT1501.*amples-amentsinad+ance/t$ese&ouldrepresent pamentst$att$e01#Maritime$asmadein ad+ancei(e(t$osein&$ic$cost$asnot"een recogni2edsincet$egood3ser+ice$asnot"een pro+idedCan also "e re)erred to as a prepayment-repamentsin+ol+eade"ittot$eprepaments account4underassets5andacredittot$ecas$ account67oncet$eser+ice$as"eenpro+ided,t$e journalentries&ouldt$en"eadjustedtore8ectt$is &it$ a de"it to e*penses and credit to prepaments Group 2 ACCT1501.*amples 4cont(5 Accrued 9ncome: t$is represents income t$at $as not "een recei+edet"ut)or&$ic$t$eser+ice$as"eenpro+ided( For instance, t$e end o) t$e 'nancial period $ere is ;0 June 2011, $o&e+er&e