Valdir Company completed the following transactions during 2011. The company's fiscal year ends on December 31 .

Jan. 15 Purchased and paid for merchandise for resale at an invoice cost of \(\$ 13,580\); assume a periodic inventory system.

April 1 Borrowed \(\$ 500,000\) from Summit Bank for general use; signed an 11 -month, 8 percent interest-bearing note.

June 14 Received a deposit of \(\$ 10,000\) from customer Marina Malek for services to be performed in the future.

July 15 Performed services to Marina Malek for \(\$ 2,500\).

Dec. 12 Received electricity bill for \(\$ 540\). The company will pay it in early January 2012.

31 Determined that wages of \(\$ 12,000\) were earned but not yet paid on December 31 (disregard payroll taxes).

Required:

1. Prepare journal entries for each of these transactions.

2. Prepare all adjusting entries required on December \(31,2011\).

3. What is the effect of each transaction on working capital and on the current ratio (increase, decrease, no effect)? Assume that the current ratio is 1.40 at January \(1,2011\).