1. On June 1, King Company paid $7,200 for one year of advertising, in advance. King Company recorded the transaction by debiting Prepaid Advertising and crediting Cash.

Required: Journalize the adjusting entry on December 31.

Note: Assume that the advertising is used evenly throughout the year

2. By the end of December, Brown Company has completed work, earning $2,500. Brown company has neither billed the clients nor recorded any of the revenue.

Required: Journalize the adjusting entry on December 31.

3. On January 2, 2020, Collins Company purchased land that cost $500,000, a building on the land that cost $910,000, and equipment that cost $73,000. The building has an estimated useful life of 28 years. The equipment has an estimated useful life of 10 years.

Required:

Prepare the property, plant, and equipment section of the balance sheet as of December 31, 2020.

Note: Use straight-line depreciation with no salvage value.