Recording adjustments for accrued and prepaid expense items and unearned income.On June 1,...

Recording adjustments for accrued and prepaid expense items and unearned income.

On June 1, 2016, Penelope Bermudez established her own advertising firm. Selected transactions for the first few days of June follow.

1. Record the transactions on page 1 of the general journal. Omit descriptions. Assume that the firm initially records prepaid expenses as assets and unearned income as a liability.

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2. Record the adjusting journal entries that must be made on June 30, 2016, on page 2 of the general journal. Omit descriptions.

Analyze: At the end of the year, 2016, how much of the rent paid on June 1 will have been charged to expense?