Verne Cova Company has the following balances in selected accounts on December 31, 2014.
|
Accounts Receivable |
$ 0 |
|
Accumulated Depreciation—Equipment |
0 |
|
Equipment |
7,000 |
|
Interest Payable |
0 |
|
Notes Payable |
10,000 |
|
Prepaid Insurance |
2,100 |
|
Salaries and Wages Payable |
0 |
|
Supplies |
2,450 |
|
Unearned Service Revenue |
30,000 |
All the accounts have normal balances. The information below has been gathered at December 31, 2014.
|
1. |
Verne Cova Company borrowed $10,000 by signing a 12%, one year note on September 1, 2014. |
|
2. |
A count of supplies on December 31, 2014, indicates that supplies of $900 are on hand. |
|
3. |
Depreciation on the equipment for 2014 is $1,000. |
|
4. |
Verne Cova Company paid $2,100 for 12 months of insurance coverage on June 1, 2014. |
|
5. |
On December 1, 2014, Verne Cova collected $30,000 for consulting services to be performed from December 1, 2014, through March 31, 2015. |
|
6. |
Verne Cova performed consulting services for a client in December 2014. The client will be billed $4,200. |
|
7. |
Verne Cova Company pays its employees total salaries of $9,000 every Monday for the preceding 5 day week (Monday through Friday). On Monday, December 29, employees were paid for the week ending December 26. All employees worked the last 3 days of 2014. |
Instructions
Prepare adjusting entries for the seven items described above.