Jan Spears opened her decorating company on January 1, 2008. During the first month of operations, the following transactions occurred:
1. Performed services for country club clients. On January 31, $2,300 of such services was earned but not yet billed to the clubs.
2. Utility expenses incurred but not paid prior to January 31 totaled $650.
3. Purchased decorating supplies on January 1 for $50,000, paying $10,000 in cash and signing a $40,000, three year note payable. Interest is $300 per month.
4. Purchased a one year fire insurance policy on January 1 for $6,000.
5. Purchased a computer at $2,100. On January 31, determined that $200 of the computer had been depreciated.
Instructions
Prepare the adjusting entries on January 31. Account titles are: Accumulated Depreciation— Furniture, Depreciation Expense, Service Revenue, Accounts Receivable, Insurance Expense, Interest Expense, Interest Payable, Prepaid Insurance, Supplies, Supplies Expense, Utilities Expense, and Utilities Payable