Gomez Co. had the following transactions in the last two months of its year ended December 31st. Nov. 1st Paid $1,900 cash for future newspaper advertising. 1st Paid $2,460 cash for 12 months of insurance through October 31st of the next year. 30th Received $3,700 cash for future services to be provided to a customer. Dec. 1st Paid $6,000 cash for a consultants services to be received over the next three months. 15 Received $7,950 cash for future services to be provided to a customer. 31st Of the advertising paid for on November 1st, $1,500 worth is not yet used. 31st A portion of the insurance paid for on November 1st has expired. No adjustment was made in November to Prepaid Insurance. 31st Services worth $1,500 are not yet provided to the customer who paid on November 30. 31st One-third of the consulting services paid for on December 1st have been received. 31st The company has performed $3,400 of services that the customer paid for on December 15th.

Required 1. Prepare entries for these transactions under the method that records prepaid expenses as assets and records unearned revenues as liabilities. Also prepare adjusting entries at the end of the year.

2. Prepare entries for these transactions under the method that records prepaid expenses as expenses and records unearned revenues as revenues. Also prepare adjusting entries at the end of the year.