Ex 3-2 Classifying adjusting entries

The following accounts were taken from the unadjusted trial balance of Orion Co., a congressional lobbying firm. Indicate whether or not each account would normally require an adjusting entry. If the account normally requires an adjusting entry, use the following notation to indicate the type of adjustment:

AE—Accrued Expense
AR—Accrued Revenue
PE—Prepaid Expense
UR—Unearned Revenue

To illustrate, the answer for the first account is shown below.

Account Answer Accounts Receivable Normally requires adjustment (AR). Cash Interest Expense Interest Receivable Johann Atkins, Capital Land Office Equipment Prepaid Rent Supplies Unearned Fees Wages Expense






Answer:

Account  Answer  Accounts Receivable ..................................  Normally requires adjustment (AR).  Cash ..............................................................  Does not normally require adjustment. Interest Expense .........................................  Normally requires adjustment (AE).  Interest Receivable .....................................  Normally requires adjustment (AR).  Johann Atkins, Capital ...............................  Does not normally require adjustment.  Land ..............................................................  Does not normally require adjustment.  Office Equipment ........................................  Does not normally require adjustment.  Prepaid Rent ................................................  Normally requires adjustment (PE).  Supplies ........................................................  Normally requires adjustment (PE).  Unearned Fees ............................................  Normally requires adjustment (UR).  Wages Expense ...........................................  Normally requires adjustment (AE).