Beginning Accounting -- Adjusting Entries.... What am I doing wrong????????????

Question

I am in a beginning accounting class.
We have a project to do on adjusting entries.

Apparently I am doing something wrong on a couple values.

Can you tell me what I'm doing wrong? I can't figure it out.

This is what I am given:
http://i6.photobucket.com/albums/y232/i_own_halo/AccountingProject1.jpg

And this is the general journal I did:
http://i6.photobucket.com/albums/y232/i_own_halo/AccountingProject3.jpg

I'd REALLLLY appreciate your help.
Thank you soo soooo much. : }

Answer 1

Okay. Let's start with your prepaid rent j/e. The information shows that your ending balance in prepaid rent should be $1,050. So, if your beginning balance is $1,290 and your ending balance should be $1,050, that means that you have to decrease your prepaid rent by $240 ($1290 - $1050).

Your next item in red: Commission Revenue. You're at least consistent in your thinking! This is the same issue as the prepaid rent problem. Your ending balance in unearned comm revenue s/b $7,750 (a liability account, so it has a credit balance). Your current balance is a credit of $8,900. So, you need to debit the account for $1,150 (8900 - 7750).

Also, I'm surprised that your Salary Payable j/e didn't come up in red. It seems to me that the account doesn't require any adjustment. The "Salary Payable" account already shows a balance of $460, making adjustment unnecessary, unless I'm misreading something here.

What might help you with a problem like this is to set up what is called a "Working Trial Balance". It shows your beginning balances on the left, then there is a column for debits, a column for credits, then the last column on the right shows what the ending balance is supposed to be. It helps keep your mind straight on where you're supposed to be.