Chapter 4: I. Recording Seven Typical Adjusting Entries Heald's Variety Store is completing the accounting process for the year just ended, December 31, 2011. The transactions during 2011 have been journalized and posted. The following data with respect to adjusting entries are available: a. Office supplies on hand at January 1, 2011, totaled $350. Office supplies purchased and debited to Office Supplies during the year amounted to $500. The year-end count showed $275 of supplies on hand. b. Wages earned by employees during December 2011, unpaid and unrecorded at December 31, 2011, amounted to $2,200. The last payroll was December 28; the next payroll will be January 6, 2012. c. Three-fourths of the basement of the store is rented for $1,600 per month to another merchant, M. Dittman Inc. Dittman sells compatible, but not competitive, merchandise. On November 1, 2011, the store collected six months' rent in the amount of $9,600 in advance from Dittman; it was credited in full to Unearned Rent Revenue when collected. d. The remaining basement space is rented to Kathy's Specialty Shop for $480 per month, payable monthly. On December 31, 2011, the rent for November and December 2011 had not been col- lected or recorded. Collection is expected January 10, 2012. e. The store used delivery equipment that cost $30,500; $6,100 was the estimated depreciation for 2011. f. On July 1, 2011, a two-year insurance premium amounting to $2,200 was paid in cash and debited in full to Prepaid Insurance. Coverage began on July 1, 2011. g. Heald's operates a repair shop to meet its own needs. The shop also does repairs for M. Dittman. At the end of December 31, 2011, Dittman had not paid $800 for completed repairs. This amount has not yet been recorded as Repair Shop Revenue. Collection is expected during January 2012. II. For each of the transactions above, indicate the amount and direction of effects of the adjusting en- try on the elements of the balance sheet and income statement. Using the following format, indicate + for increase, for decrease, and NE for no effect. BALANCE SHEET INCOME STATEMENT Stockholders' Net Transaction Assets Liabilities Equity Revenues Expenses Income a. b. c. etc.