Analyzing Starbucks' Financial Statements This problem develops skills in preparing adjusting journal entries. Refer to the financial statements of Starbucks (Appendix A at the end of the book). Note the following balance sheet items: Prepaid expenses and other current assets Other accrued expenses September 28, 2003 $ 55,173,000 101,800,000. September 29, 2002 $ 42,351,000 72,289,000 Suppose that during the year ended September 28, 2003, $31,200,000 cash was disbursed and charged to Prepaid Expenses and $61,600,000 of accrued liabilities were paid in cash. 1. Assume that the Prepaid Expenses account relates to outlays for miscellaneous operating expenses, for example, supplies, insurance, and short-term rentals. Prepare summary journal entries for

(a) the disbursements and

(b) the expenses (for our purposes, debit Operating Expenses) for the year ended September 28, 2003. Post the entries to the T-accounts. 2. Prepare summary journal entries for

(a) the disbursements and

(b) the expenses related to the accrued liabilities for the year ended September 28, 2003. (For our purposes, debit Operating Expenses.) Post the entries to the T-accounts.