Folton Motor Company faced the following situations. Journalize the adjusting entry needed at December 31, 2010, for each situation. Consider each fact separately.
a. The business has interest expense of $9,200 that it must pay early in January 2011.
b. Interest revenue of $4,200 has been earned but not yet received.
c. On July 1, when we collected $12,600 rent in advance, we debited Cash and credited Unearned Rent Revenue. The tenant was paying us for two years rent.
d. Salary expense is $1,900 per day Monday through Friday and the business pays employees each Friday. This year, December 31 falls on a Wednesday.
e. The unadjusted balance of the Supplies account is $2,600. The total cost of supplies on hand is $1,200.
f. Equipment was purchased at the beginning of this year at a cost of $160,000. The equipments useful life is five years. There is no residual value. Record depreciation for this year and then determine the equipments book value.