1. Martinez Companys weekly payroll, paid on Fridays, totals $7,540. Employees work a 5-day week. Prepare Martinezs adjusting entry on Wednesday, December 31, and the journal entry to record the $7,540 cash payment on Friday, January 2. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter 0 for the amounts.)

2. On July 1, 2020, Indigo Co. pays $10,480 to Sweet Insurance Co. for a 2-year insurance policy. Both companies have fiscal years ending December 31. Journalize the entry on July 1 and the adjusting entry on December 31 for Sweet Insurance Co. Sweet uses the accounts Unearned Service Revenue and Service Revenue. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter 0 for the amounts. Record journal entries in the order presented in the problem.)