5. If a company receives money in advance of performing a service, the journal entry to record the transaction a. debits cash and credits prepaid services. b. debits unearned fees and credits accounts payable. c. debits cash and credits unearned service revenue. d. debits cash and credits accounts receivable. 6. Acme Laundry Company purchased $8,500 worth of laundry supplies on June 2 and recorded the purchase as an asset. On June 30, an inventory of the laundry supplies indicated only $1,500 on hand. The adjusting entry that should be made by the company on June 30 is a. debit Supplies Expense, $1,500; credit Supplies, $1,500. b. debit Supplies, $7,000; credit Supplies Expense, $7,000. c. debit Supplies, $1,500; credit Supplies Expense, $1,500. d. debit Supplies Expense, $7,000; credit Supplies, $7,000. 7. The following is selected information from Acme Corporation for the fiscal year ending October 31, 2025: Cash received from customers $150,000 Revenue recognized 225,000 Cash paid for expenses 85,000 Cash paid for computers on November 1, 2024 that will be used for 3 years 24,000 Expenses incurred including any depreciation 119,000 Proceeds from a bank loan, part of which was used to pay for the computers 50,000 Using on the accrual basis of accounting, what is Acme Corporation's net income for the year ending October 31, 2025? a. $132,000 b. $116,000 C. $106,000 d. $140,000 8. Which of the following items describe the two classifications of adjusting entries? a. b. Accruals and advances C. Postponements and advances Deferrals and postponements d. Accruals and deferrals