Question

The information necessary for preparing the 2021 year-end adjusting entries for Gamecock Advertising Agency appears below. Gamecock's fiscal year-end is December 31 1. On July 1, 2021. Gamecock receives $5.900 from a customer for advertising services to be given evenly over the next 10 months. Gamecock credits Deferred Revenue. 2. At the beginning of the year, Gamecock's depreciable equipment has a cost of $34,500, a five-year life, and no salvage value. The equipment is depreciated evenly straight-line depreciation method) over the five years 3. On May 1, 2021, the company pays $4,680 for a two-year fire and liability insurance policy and debits Prepaid Insurance 4. On September 1, 2021, the company borrows $19.000 from a local bank and signs a note. Principal and interest at 9% will be paid on August 31, 2022 5. At year-end there is a $2,650 debit balance in the Supplies (asset)accountOnly $990 of supplies remains on hand. Required: Record the necessary adjusting entries on December 31, 2021 No prior adjustments have been made during 2021 (Do not round intermediate calculations. If no entry is required for a particular transaction/event, select "No Journal Entry Required in the first account field) View transaction lit Journal entry worksheet On July 1, 2021, Gamecock receives $5.900 from a customer for advertising services to be given evenly over the next 10 months. Gamecock credits Deferred Revenue. Record the adjusting entry for deferred revenue at its year- end of December 31. Note: Enter debbore credits < Prey 4 of 6 Next > c a search or type URL *

Answer 1

Adjusting entry

No	General journal	Debit	Credit
1	Deferred revenue (5900/10*6)	3540
	Advertising revenue		3540
2	Depreciation expense (34500/5)	6900
	Accumulated depreciation-equipment		6900
3	Insurance expense (4680/24*8)	1560
	Prepaid insurance		1560
4	Interest expense (19000*9%*4/12)	570
	Interest payable		570
5	Supplies expense (2650-990)	1660
	Supplies		1660