PREPAYMENTS FOR EXPENSES WITH BEGINNING BALANCES. Bakersfield Products had the following balances in its prepaid rent and prepaid insurance accounts at January 1, 19x2:

Prepaid rent ........... $14,000 Prepaid insurance ...... 10,800 The rent and insurance underlying the prepayments existing on January 1, 19x2, were used in the early months of 19x2. During 19x2, Bakersfield prepaid rent and insurance in the amounts and for the periods indicated below:

Rent (for the 12 months beginning 3/1/x2) ................. Pew aes ae $96,000 Insurance (for the 6 months beginning 10/1/x2) ............ BORE eee 9,000 Bakersfield debits prepayments to asset accounts when the prepayments are made.

REQUIRED:

1. Determine the amount of rent and insurance expense for 19x2.

2. Prepare the adjusting entries necessary at December 31,19x2.