Journalize the adjusting entry needed on December 31, end of the current accounting period, for each of the following independent cases affecting Callaway Corp. Include an explanation for each entry.

a. Details of Prepaid Insurance are shown in the account:

Callaway prepays insurance on March 31 each year. At December 31, $600 is still prepaid.
b. Callaway pays employees each Friday. The amount of the weekly payroll is $6,000 for a 5-day work week. The current accounting period ends on Wednesday.
c. Callaway has a note receivable. During the current year, Callaway has earned accrued interest revenue of $500 that it will collect next year.
d. The beginning balance of supplies was $2,600. During the year, Callaway purchased supplies costing $6,100, and at December 31 supplies on hand total $2,100.
e. Callaway is providing services for Manatee Investments, and the owner of Manatee paid Callaway $12,000 as the annual service fee. Callaway recorded this amount as Unearned Service Revenue. Callaway estimates that it has earned one-third of the total fee during the current year.
f. Depreciation for the current year includes Office Furniture, $1,000 and Equipment, $2,700. Make a compound entry.

Transcribed Image Text:

Prepaid Insurance Jan. 1 B 400 Mar. 31 3,600