Chapter 9.1
Adjusting Entries
• Some amounts on
the trial balance
are out of date
Chapter 9.1
Adjusting Entries
• The Supplies
balance shows the
total supplies
purchased in the
• Adjusting Entries year
Chapter 9.1
Adjusting Entries
• What the
balance is
Chapter 9.1
Adjusting Entries
• What the
balance
should be
• What the balance “should be” is
determined from someone counting
the supplies that remain in the
business at the end of the year
Chapter 9.1
Adjusting Entries
• The required
adjustment
Chapter 9.1
Adjusting Entries
• What the
balance is
• The income statement account
related to Supplies is shown above
• The accounting clerk has not used
this account during the year
Chapter 9.1
Adjusting Entries
• What the
balance
should be
• What the balance “should be” is the
amount of supplies “used up” during
the year
Chapter 9.1
Adjusting Entries
• The
required
adjustment
Chapter 9.1
Adjusting Entries
• The adjusting entry as it would
appear in the general journal
Chapter 9.1
Adjusting Entries
• The Prepaid
Insurance balance
shows the total
cost of insurance
• Adjusting Entries bought in the year
Chapter 9.1
Adjusting Entries
• What the
balance is
Chapter 9.1
Adjusting Entries
• What the
balance
should be
• What the balance “should be” is
determined from someone
calculating the portion of the
insurance policy that is “unexpired”
Chapter 9.1
Adjusting Entries
• The required
adjustment
Chapter 9.1
Adjusting Entries
• What the
balance is
• The income statement account
related to Prepaid Insurance is
shown above
• The accounting clerk has not used
this account during the year
Chapter 9.1
Adjusting Entries
• What the
balance
should be
• What the balance “should be” is the
amount of the insurance policy that
has expired at year’s end
Chapter 9.1
Adjusting Entries
• The
required
adjustment
Chapter 9.1
Adjusting Entries
• The adjusting entry for insurance as
it would appear in the general journal
Chapter 9.1
Adjusting Entries
• Adjusting Entries
• The Accounts
Payable balance
does not include
two invoices that
arrived late
Chapter 9.1
Adjusting Entries
• Little analysis is needed for this
adjustment
Chapter 9.1
Adjusting Entries
• Simply enter the late invoices
Chapter 9.1
Adjusting Entries
• Simply enter the late invoices
Chapter 9.1
Adjusting Entries
• And calculate the adjusted balance
Chapter 9.1
Adjusting Entries
Chapter 9.1
Adjusting Entries
Chapter 9.1
Adjusting Entries
Chapter 9.1
Adjusting Entries
• The adjusting entry for late invoices
as it would appear in the general
journal
Chapter 9.1
Adjusting Entries—Summary
Entries
• The adjusting entries have brought
balance sheet accounts up to date
Balance Sheet
Chapter 9.1
Adjusting Entries—Summary
Entries
• And have recorded expenses in related
accounts on the income statement
Balance Sheet
Income Statement