It is December 31, 2014 and Hortons Co. is about to prepare its year end adjusting journal entries.

REQUIRED: Prepare the December 31, 2014 annual adjusting entries for each of the items listed below. Explanations are not required. Only adjusting entries are required.

• On August 1, 2014, the company paid $4,800 for a 2-year insurance policy.

• On October 1, 2014, the company received $6,000 cash in advance for consulting services. As at December 31, 2014, $4,000 had not yet been earned.

• Equipment was purchased on January 1, 2012 for $50,000. At that time, the company estimated that the equipment would have a 10 year useful life and a $0 residual value at the end of its life.