B-1 Organic Food Company (B-1) engages in the business of selling organic food on-line. The company adjusts its accounts monthly, closes its accounts annually on 31 December. B-1 uses a perpetual inventory system and the gross profit rate is 40%. Below is the unadjusted trial balance of B-1 Company as at 31 December 2021. B-1 Organic Food Company Unadjusted Trial Balance 31 December 2021 Cash Accounts receivable Interest receivable Supplies Inventory Prepaid rent Office fixtures and fittings Accumulated depreciation: office fixtures and fittings Notes receivable (due on 31 December 2021) Accounts payable Income tax payable Ordinary shares Retained earnings Sales revenues Interest revenue Cost of goods sold Selling and administration expense Rent expense Salaries expense Supplies expense Utilities expense Depreciation expense Income taxes expense Total Debit Credit $ $ 746,600 696,990 5,500 7,710 199,500 165,000 180,000 82,000 120,000 42,500 13,000 1,000,000 467,400 2,020,000 5,500 575,500 157,000 405,000 320,000 15,870 12,730 10,000 13,000 3,630,400 3,630,400 The following events have not yet been recorded / adjusted in the books of B-1 Company. (1) $7,000 was received from a customer in advance on 31 December 2021 for the frozen food to be delivered on 4 January 2022. (2) Prepaid rent was paid and recorded by B-1 on 1 November 2021 to cover rent for the period 1 November 2021 to end of April 2022. (3) There was an unrecorded and unpaid salary of $15,000 earned by a staff for December 2021. (4) Supplies on hand as at 31 December 2021 amounted to $900. (5) The 1-year note receivable was signed on 1 January 2021 at 5% interest per annum with Mr Jones. The entire note and all the accrued interest were due and received on 31 December 2021. No entries were made for the adjustment and the receipt in December 2021. (6) A customer returned 2 packs of walnuts (selling price: $275 per pack) to B-1 on 30 December 2021 and got a cash refund. (7) B-1 promised to deliver 20 packs of organic baby food to Lexmark Company on 5 January 2022 and the payment will be made upon delivery. (8) B-l's auditor estimated that the income taxes expense for the entire year was $14,000 which to be paid next year. (9) On 31 December 2021, B-1 made an inventory taking and found that there was $195,000 inventory on hand. (a) Prepare the necessary journal / adjusting entries to update the books of B-1 Company. Use the account titles given in the Trial Balance or create new accounts where appropriate. No explanation is required. If no adjusting entries are required, state No entry and name the accounting principle applied. (22 marks)