Adjustment Process Chris Vining organized The Herbal Shoppe at the beginning of February 20Y4. During February, The Herbal Shoppe entered into the following transactions: a.Chris Vining invested $25,000 in The Herbal Shoppe in exchange for capital stock. b.Paid $4,200 on February 1 for an insurance premium on a 1-year policy. c.Purchased supplies on account, $1,200. d.Received fees of $36,500 during February. e.Paid expenses as follows: wages, $12,000; rent, $2,000; utilities, $1,000; and miscellaneous, $1,100. f.Paid dividends of $7,500. The transactions above have already been recorded in the integrated financial statement framework below. Record the adjusting entries at the end of February to record the insurance expense and supplies expense. There was $900 of supplies on hand as of February 28. Identify the adjusting entry for insurance as (a1) and supplies as (a2). Use the integrated financial statement framework below. After each transaction, enter a balance for each item. If an amount box does not require an entry, leave it blank. Enter account decreases as negative amounts. Statement of Cash Flows Balance Sheet Income Statement Assets = Liabilities + Stockholders' Equity Cash + Supplies + Prepaid Insurance = Accounts Payable + Capital Stock + Retained Earnings a. Investment 25,000 25,000 b. Paid insurance 4,200 4,200 Balances 20,800 4,200 25,000 c. Purchased supplies 1,200 1,200 Balances 20,800 1,200 4,200 1,200 25,000 d. Fees earned 36,500 36,500 d. Balances 57,300 1,200 4,200 1,200 25,000 36,500 e. Paid expenses 16,100 16,100 e. Balances 41,200 1,200 4,200 1,200 25,000 20,400 f. Paid dividends -7,500 -7,500 Balances 33,700 1,200 4,200 1,200 25,000 12,900 a1. SelectFees earnedInsurance expenseInvestmentPaid dividendsPaid expensesPaid insurancePurchased suppliesSupplies expense a1. Balances a2. SelectFees earnedInsurance expenseInvestmentPaid dividendsPaid expensesPaid insurancePurchased suppliesSupplies expense a2. Balances, February 28 Statement of Cash Flows Income Statement a. Financing $25,000 d. Fees earned $36,500 b. Operating -4,200 e. Wages expense -12,000 d. Operating 36,500 e. Rent expense -2,000 e. Operating -16,100 e. Utilities expense -1,000 f. Financing -7,500 e. Miscellaneous expense -1,100 Increase in cash $33,700 a1. SelectFees earnedInsurance expensePrepaid insuranceNo effect a2. SelectDividendsSuppliesSupplies expenseNo effect SelectNet incomeNet lossNo effect $