3 ADJUSTING ENTRIES (12 Marks): Hummingbird Corporation prepares yearly financial statements. Below are listed some selected accounts and their balances on the September 30 trial balance before any adjustments have been made for the September year end. Hummingbird Corporation Unadjusted Trial Balance (Partial) September 30, 2013 DEBIT CREDIT Office supplies Prepaid Insurance Office equipment Accumulated amortization- office equipment Unearned rent revenue $ 2,700 5,400 20,000 $ 7,200 1,200 (Note: Debit column does not equal credit column because this is a PARTIAL listing of selected account balances.) Required: Prepare the year end adjusting entries (show your calculations), with the following additional information: 1. On October 1, 2012 the business had $700 of supplies on hand. During the year, $2,000 of supplies were purchased. A physical count of office supplies revealed $200 of supplied on hand at September 30. (3 marks) Date Account Office supply expense Office supply Debit Credit 2500 2500 2. A two-year life insurance policy was purchased on June 1 for $5,400. (3 marks) Date Account Insurance expense Prepaid insurance Debit 225 Credit 225 QUESTION 3 (continued): 3. Office equipment was purchased on October 1, 2010 for $20,000. It has an estimated useful life of 5 years and is expected to be sold for $2,000 (residual value) at the end of the 5 year life. (3 marks) Date Account Debit Depreciation Expense 3600 Accumulated Depreciation Credit 3600 4. The amount of rent revenue received in advance that remains unearned at September 30th is $500. (3 marks) Date Account Debit Credit Unearned Service Revenue 700 Service Revenue 700