In the first year of operations Lien Company entered into the following transactions among others:

a. 1 January bought equipment 105000.

b. 31 march prepaid one year’s rent 24000.

c. 1 July took out a one year loan from the bank at an annual interest rate of 8 percent 20000.

d. 1 August received payment for services not yet rendered 12000.

On 31 December lien has earned 8000 of the 12000 in transaction 4 and has incurred but not recorded 450 of electricity. Lien prepares adjusting entries on an annual basis.

Required:

Prepare journal entries for transactions a and d. prepare any adjusting journal entries needed at 31 December. Assume that the equipment depreciates 15000 annually.