In its first year of operations Lien Corporation entered into the following transactions, among others:
1. January 1: Bought equipment, $105,000.
2. March 31: Prepaid one year's rent, $24,000.
3. July 1: Took out a one year loan from the bank at an annual interest rate of 8%, $20,000.
4. August 1: Received payment for services not yet rendered, $12,000.
On December 31, Lien has earned $8,000 of the SI 2,000 in transaction 4 and has incurred but not recorded $450 of utilities. Lien prepares adjusting entries on an annual basis.
Required
Prepare journal entries for transactions 1-4. Prepare any adjusting journal entries needed at December 31. Assume that the equipment depreciates $15,000 annually.