Do It! Review 3-03

Carla Vista Computer Services began operations in July 2020. At the end of the month, the company prepares monthly financial statements. It has the following information for the month.

1.At July 31, the company owed employees $1,400in salaries that the company will pay in August.

2.On July 1, the company borrowed $20,400from a local bank on a 10-year note. The annual interest rate is12%.

3.Service revenue unrecorded in July totaled $2,400.

Prepare the adjusting entries needed at July 31, 2020.