Question

Below are transactions for Wolverine Company during 2021. 1. On December 1, 2021, Wolverine receives $4,000 cash from a company that is renting office space from Wolverine. The payment, representing rent for December and January, is credited to Deferred Revenue. 2. Wolverine purchases a one-year property insurance policy on July 1, 2021, for $13,200. The payment is debited to Prepaid Insurance for the entire amount 3. Employee salaries of $3,000 for the month of December will be paid in early January 2022. 4. On November 1, 2021, the company borrows $15,000 from a bank. The loan requires principal and interest at 10% to be paid on October 30, 2022. 5. Office supplies at the beginning of 2021 total $1,000. On August 15, Wolverine purchases an additional $3,400 of office supplies, debiting the Supplies account. By the end of the year. $500 of office supplies remains. Required: Record the necessary adjusting entries at December 31, 2021, for Wolverine Company. You do not need to record transactions made during the year. Assume that no financial statements were prepared during the year and no adjusting entries were recorded. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field. Do not round intermediate calculations.) View transaction lit Journal entry worksheet 1 2 3 5 On December 1, 2021, Wolverine receives $4,000 cash from a company that is renting office space from Wolverine. The payment, representing rent for December and January, is credited to Deferred Revenue. Record the adjusting entry for deferred revenue at its year-end of December 31. Note: Enter debits before credits.

Answer 1

Transaction	Date	General Journal	Debit	Credit
1	December 31, 2021	Deferred revenue	2,000
		Rent revenue		2,000
		( To record deferred rent revenue earned)
2	December 31, 2021	Insurance expense	6,600
		Prepaid insurance		6,600
		( To record insurance expense)
3	December 31, 2021	Salaries expense	3,000
		Salaries payable		3,000
		( To record salaries expense)
4	December 31, 2021	Interest expense	250
		Interest payable		250
		( To record interest expense)
5	December 31, 2021	Supplies expense	3,900
		Supplies		3,900
		( To record supplies expense)

1. Rent revenue for 2 months = $4,000

Rent revenue for December (1 month ) = 4,000 x 1/2

= $2,000

2. Insurance expense for 1 year = $13,200

Insurance expense for 6 months (July 1 to December 31) = 13,200 x 6/12

= $6,600

4. Interest payable on December 31 = Note payable x Interest rate x Time period/12

= 15,000 x 10% x 2/12

= $250

5. Supplies expense = Beginning supplies + Supplies purchased - Ending supplies

= 1,000+3,400-500

= $3,900

Kindly comment if you need further assistance. Thanks