Adjusting and closing entries

The following trial balance was taken from the books of Castle Top Corporation on December 31, 2012

Account	Debit	Credit
Cash	$9,000
Accounts Receivable	40,000
Notes Receivable	10,000
Allowance for Doubtful Accounts		$1,800
Inventory	44,000
Prepaid Insurance	4,800
Equipment	110,000
Accumulated Depreciation -Equip		15,000
Accounts Payable		10,800
Common Stock		44,000
Retained Earnings		75,000
Sales Revenue		260,000
Cost of Goods Sold	126,000
Salaries and Wages Expense	50,000
Rent Expense	12,800
Totals	$406,600	$406,600

At year end, the following items have not yet been recorded.

a. Insurance expired during the year, $2000.

b . Estimated bad debts, 1% of gross sales.

c. Depreciation on equipment, 10% per year.

d. Interest at 6% is receivable on the note for one full year.

e. Rent paid in advance at December 31, $5,400 (originally charged to expense)

f. Accrued Salaries and Wages at December 31, $5,800.

Instructions:

1. Prepare the necessary adjusting entries.

2. Prepare the necessary closing entries.