1. prepare adjusting entries for the following items. Omit explanations.

a. Unrecorded interest on savings bonds is $680.

b. Property taxes incurred but not paid or recorded amount to $540.

c. Legal fees of $5,000 were collected in advance. By year end, 60 percent were still unearned.

d. Prepaid Insurance had a $1,600 debit balance prior to adjustment. By year end, 40 percent was still unexpired.

e. Salaries incurred by year end but not yet paid or recorded amounted to $1,375.

f. Services totaling $900 have been performed but not yet recorded or billed.

2. Prepare (in good form) an income statement, statement of retained earnings, and balance sheet. To do so you will need to determine the missing amounts for A, B, C, and D. The name of the business is Oak Manufacturing and the accounting period coincides with the calendar year. The balance in the Retained Earnings account as of December 31, 20X5 is $6,600.

Oak Manufacturing

Adjusted Trial Balance December 31, 20x5

Cash $ 1,590

Accounts Receivable 3,600

Supplies 60

Prepaid Insurance 60

Office Equipment 6,000

Accumulated DepreciationOffice Equipment $ "B" (credit)

Accounts Payable 1,600 (credit)

Salaries Payable 210

Common Stock 2,000

Retained Earnings "D" (credit)

Service Revenue 6,600

Salaries Expense "A" (debit)

Supplies Expense 240

Insurance Expense 300

Depreciation Expense Office Equipment 300

"$C" $15,510