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13 A review of the ledger of Monkey Ltd at 30 June 2016 produced the following data relating to the preparation of annual adjusting entries. Prepaid...
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The annual subscription is for 12 monthly issues. The June magazine for all of the
subscriptions had been delivered to the subscribers at 30 June 2016.
3. Bank Loan $100 000: the loan was taken out on 1 April at an annual interest rate
of 6%.
4. Salaries Payable: There are eight salaried employees. Salaries are paid every Friday for
the current week. Four employees receive a salary of $1050 each per week, and three
employees earn $1350 each per week. 30 June is a Tuesday. Employees do not work
on weekends. All employees worked the last 2 days of June.
Required
(a) Prepare the adjusting journal entries at 30 June 2016.
(b) Explain why the business would not recognise the full subscription revenue when
the customers sign up for the magazines and pay for the subscription.
I need help with part (a)
