Refer to E 2–9 and respond to the following requirements.

Required:
1. If Microchip’s accountant employed reversing entries for accruals, which adjusting entries would she likely reverse at the beginning of the following year?
2. Prepare the adjusting entries at the end of 2021 for the adjustments you identified in requirement 1.
3. Prepare the appropriate reversing entries at the beginning of 2022.

E 2–9

Prepare the necessary adjusting entries at December 31, 2021, for the Microchip Company for each of the following situations. Assume that no financial statements were prepared during the year and no adjusting entries were recorded.