CHAPTER 3 The Styne Company began operations on January 1, 20x1. The company owns an office building containing 20 separate offices. Adjusting entries are prepared once a year, on December 31st. Selected information is provided below pertaining to certain accounts at 12/31/xs. 1) A note receivable exists, as follows Dated: Pri Term of note: Stated interest rate: 10/1/x5 $9,000 5 months 6% 2) A prepaid insurance account consists of two policies. The amounts indicated represent the full premium paid for the entire term of the policy 3 year policy: dated:5/1/x4 Total premium paid: 2 year policy: dated: 9/1/x5 Total premium paid: 9,540 5,520 3) The company purchased new heating equipment, applying the straight-line method of depreclation: inital purchase price: $90,000 Estimated useful life: 15 Unadiusted balance in accumulated depreciation account at 12/31/x5 S 7,040 Accounts payable are owed to suppliers of cleaning materials for the building. Materials expense for the year 4) 25,000 The 12/315 balance in accounts payable Cash paid during the year for supplies $2,250 28,350 Two notes payable exist at year-end. For notes with terms exceeding one year, interest is payable annually, on the anniversary date of the note (e.g, the interest for the first year for note payable A Is due on 4/1/x5, etc.) For notes with terms less than one year, full interest is pald when the note is due. Note payable A- dated Principal: Term of note Stated interest rate: 5% ) 4/1/x4 $24,000 Note Payable B- dated: Principal Term of note Stated interest rate: 8/1/x5 $33,000 8 months 4%