1. The supplies account had a beginning balance of $1,600. Supplies purchased during the period amounted to $4,000. At the end of the pre-adjustment period, $400 worth of supplies were available.

Required:

Prepare the supply adjustment entry. Please refer to the Chart of Accounts for the exact wording of account titles.

2. On the first day of the fiscal year, a company issues a $740,000 10-year bond at 9% that pays $33,300 semiannual interest ($740,000 x 9% x 1/2), receiving $777,000 in cash.

Required

Post the entry to record the first interest payment and premium amortization using the straight-line method.