Preparing adjusting entries Prepare adjusting journal entries for the year ended December 31, 2008, for each of these separate sit-
uations. Assume that prepaid expenses are initially recorded in asset accounts. Also assume that fees collected in advance of work are initially recorded as liabilities.

a. Depreciation on the company’s equipment for 2008 is computed to be $23,000.

b. Two-thirds of the work related to \($15,000\) of cash received in advance was performed this period.

c. The Prepaid Insurance account had a \($2,600\) debit balance at December 31, 2008, before adjusting for the costs of any expired coverage. An analysis of insurance policies showed that \($2,100\) of coverage had expired as of December 31, 2008.

d. Wage expenses of \($6,700\) have been incurred but are not paid as of December 31, 2008.