Effect of adjusting entries on the accounting equationRequiredEach of the following indepe...

Effect of adjusting entries on the accounting equation

Required

Each of the following independent events requires a year-end adjusting entry. Show how each event and its related adjusting entry affects the accounting equation. Assume a December 31 closing date. The first event is recorded as an example.

a. Paid $3,600 cash in advance on October 1 for a one-year insurance policy.

b. Received an $ 1,800 cash advance for a contract to provide services in the future. The contract required a one-year commitment, starting April 1.

c. Purchased $800 of supplies on account. At year’s end, $140 of supplies remained on hand.

d. Paid $7,200 cash in advance on August 1 for a one-year lease on office space.