Deferred Expense Adjusting Entries Best Company had the following items that require adjustment at year end. a. Cash for equipment rental in the amount of $3,800 was paid in advance. The $3,800 was debited to prepaid rent when paid. At year end, $2,590 of the prepaid rent had expired. b. Cash for insurance in the amount of $9,100 was paid in advance. The $9,100 was debited to prepaid insurance when paid. At year end, $1,750 of the prepaid insurance was still unused. c. Supplies at the beginning of the year showed a balance of $2,000. Best purchased supplies of $17,896 during the year. At the end of the year, a physical count of supplies showed $4,125 of supplies on hand. Required: 1. Prepare the adjusting journal entries needed at December 31. If an amount box does not require an entry, leave it blank. Dec. 31 Dec. 31 Dec. 31 2. What is the effect on the financial statements if these adjusting entries are not made? In all these cases, was originally created when cash was paid. The adjusting entries will affect account. If these entries were not made, expenses would be and assets would be . In addition, net income will be 3. What is the balance in prepaid equipment rent, insurance expense, and supplies at December 31