Exercise 1 (50 points) Scotsman Company prepares monthly financial statements. Below is listed some selected accounts and their balances in the September 30 trial balance before any adjustments have been made for the month of September. SCOTSMAN COMPANY Trial Balance (Selected Accounts) September 30, 2020 Credit Supplies. Prepaid Insurance Office Equipment. Debit 2,700 3,150 16,200 An analysis of the account balances by the company's accountant provided the following additional information: 1. A physical count of office supplies revealed 700 on hand on September 30. 2. A two-year life insurance policy was purchased on June 1 for 3,600. Instructions Using the above additional information, prepare the adjusting entries that should Scotsman Company on September 30. made by Exercise 2 short answer questions (30 points - 15 each). 1. Describe the purpose of adjusting entries. Why companies need to prepare adjusting entries and how often? 2. List four types of Adjusting entries? Give at least 2 examples of any type. 4 LTE l myportal.acm.edu.kw Exercise 3 (20 points - 10 each), State if the statement is True or False. 1) An adjusting entry for accrued revenues increases an asset account on the statement of financial position and increases a revenue account on the income statement. 2) Unearned revenue is a prepayment that requires an adjusting entry when services are performed Bonus question (10 points) The adjusting Entry to record depreciation should be: Dr. CR