Question

The following transactions occurred during December 31, 2021, for the Falwell Company. 1. A three-year fire insurance policy was purchased on July 1, 2021, for $11,520. The company debited insurance expense for the entire amount 2. Depreciation on equipment totaled $11,750 for the year, 3. Employee salaries of $15,500 for the month of December will be paid in early January 2022. 4. On November 1, 2021, the company borrowed $170,000 from a bank. The note requires principal and interest at 12% to be paid on April 30, 2022 5. On December 1, 2021, the company received $5,400 in cash from another company that is renting office space in Falwell's building, The payment, representing rent for December, January, and February was credited to deferred rent revenue. 6. On December 1, 2021, the company received $5,400 in cash from another company that is renting office space in Falwell's building, The payment, representing rent for December, January, and February was credited to rent revenue rather than deferred rent revenue for $5,400 on December 1, 2021. Prepare the necessary adjusting entries for each of the above situations. Assume that no financial statements were prepared during the year and no adjusting entries were recorded. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet 2 3 4 5 6 A three-year fire insurance policy was purchased on July 1, 2021, for $11,520. The company debited insurance expense for the entire amount. Note: Enter debits before credits. Transaction General Journal Debit Credit 1 Record entry Clear entry View general journal

Answer 1

transaction	particulars	debit	Credit
1	prepaid insurance...Dr	$1920
	To insurance expense		$1920
	(11520/3 *1/2)
2	depreciation expense...Dr	$11750
	To accumulated interest		$11750
3	salary expense...Dr	$15500
	To salary payable		$15500
4	Interest expense...Dr	$3400
	To interest payable		$3400
	(170,000×12%×2/12)
5	deffered rent revenue...Dr	$1800
	To Rent Revenue		$1800
	(5400/3)
6	Rent Revenue...Dr	$3600
	To deferred rent revenue		$3600
	(5400*2/3)