An accountant made the following adjustments at December 31, the end of the accounting period:

a. Prepaid insurance, beginning, \(\$ 700\). Payments for insurance during the period, \(\$ 2,100\). Prepaid insurance, ending, \(\$ 800\).

b. Interest revenue accrued, \(\$ 900\).

c. Unearned service revenue, beginning, \(\$ 800\). Unearned service revenue, ending, \(\$ 300\).

d. Depreciation, \(\$ 6,200\).

e. Employees' salaries owed for three days of a five-day work week; weekly payroll, \(\$ 9,000\).

f. Income before income tax expense, \(\$ 20,000\). Income tax rate is \(25 \%\).

Requirements

1. Journalize the adjusting entries.

2. If the accountant was biased to report a better operating performance for the period than actually occurred, which of the preceding adjustments would he have not made and why? Would it have been ethical for him to do this?