Trey Co. entered into the following two transactions. Trey prepares financial statements annually at December 31.

a. Trey rents a building for $2,800 per month beginning December 1. By agreement, Trey paid cash for both December and January rent on January 2.

b. Trey rents space in a building it owns to a tenant for $850 per month. Trey agreed to allow the tenant to delay payment for December and January rent until January 3, when the tenant paid cash for both months.

Required

1. Prepare adjusting entries the company must record for these events as of December 31.

2. Assuming Trey does not use reversing entries, prepare journal entries to record Trey’s payment of rent on January 2 and the collection of the tenant’s rent on January 3.

3. Assuming Trey uses reversing entries, prepare reversing entries on January 1. Also prepare journal entries to record Trey’s payment of rent on January 2 and the receipt of the tenant’s rent on January 3.