Drew Carey Company has the following balances in selected accounts on December 31, 2008.

All the accounts have normal balances. The information below has been gathered at December 31, 2008.

1. Drew Carey Company borrowed \($10,000\) by signing a 12%, one-year note on September 1, 2008.

2. A count of supplies on December 31, 2008, indicates that supplies of \($800\) are on hand.

3. Depreciation on the equipment for 2008 is \($1,000.\)

4. Drew Carey Company paid \($2,100\) for 12 months of insurance coverage on June 1, 2008.

5. On December 1, 2008, Drew Carey collected \($40,000\) for consulting services to be performed from December 1, 2008, through March 31, 2009.

6. Drew Carey performed consulting services for a client in December 2008. The client will be billed \($4,200.\)

7. Drew Carey Company pays its employees total salaries of \($9,000\) every Monday for the preceding 5-day week (Monday through Friday). On Monday, December 29, employees were paid for the week ending December 26. All employees worked the last 3 days of 2008.

Instructions 

Prepare adjusting entries for the seven items described.

Transcribed Image Text:

Accounts Receivable Accumulated Depreciation-Equipment Equipment Interest Payable Notes Payable Prepaid Insurance Salaries Payable Supplies Unearned Consulting Revenue $ -0- -0- 7,000 -0- 10.000 2,100 -0- 2,450 40,000