Anthony Asher's administrative assistant maintains a very simple computerized general ledger system. This system includes intuitive routines for recording receipts, payments, and sales on account. However, the system is not sufficiently robust to automate end-of-period adjustments. Below is the trial balance for the month ending January 31, 20X8. This trial balance has not been adjusted for the various items that are described below. Review the trial balance and narratives, and prepare the necessary adjusting entries.

Asher Corporation

Trial Balance

January 31, 20X8

Debits Credits

Cash

$ 37,500

$ -

Accounts receivable

12,410

Prepaid insurance

2,400

-

Supplies

7,113

-

Equipment

35,000

-

Accumulated depreciation

-

10,000

Accounts payable

-

7,569

Unearned revenue

-

8,500

Loan payable

-

15,000

Capital stock

-

24,000

Retained earnings, Jan. 1

-

15,457

Revenues

-

43,995

Salary expense

12,098

-

Rent expense

13,000

-

Office expense

2,500

-

Dividends

2,500

-

$ 124,521

$ 124,521

a) Asher Corporation's equipment had an original life of 140 months, and the straight-line depreciation method is used. As of January 1, the equipment was 40 months old. The equipment will be worthless at the end of its useful life. b) As of the end of the month, Asher Corporation has provided services to customers for which the earnings process is complete. Formal billings are normally sent out on the first day of each month for the prior month's work. January's unbilled work is $25,000. c) Utilities used during January, for which bills will soon be forthcoming from providers, are estimated at $1,500. d) A review of supplies on hand at the end of the month revealed items costing $3,500. e) The $2,400 balance in prepaid insurance was for a 6-month policy running from January 1 to June 30. f) The unearned revenue was collected in December of 20X7. Sixty percent of that amount was actually earned in January with the remainder to be earned in February. g) The loan accrues interest at 1% per month. No interest was paid in January.