Mellor Towing Company provides hauling and delivery services for other businesses. It is at the end of its accounting year

ending December $31.$ The following data that must be considered were developed from the company's records and

related documents:

a$.$ On January $1$ of the current year, the company purchased a new hauling van at a cash cost of $$24,800.$ Depreciation

estimated at $$3,100$ for the year has not been recorded for the current year.

b$.$ During the current year, office supplies amounting to $$850$ were purchased for cash and debited in full to Supplies.

At the end of last year, the count of supplies remaining on hand was $$370.$ The inventory of supplies counted on

hand at the end of the current year was $$440.$

c$.$ On December $31$ of the current year, Lanie's Garage completed repairs on one of Mellor Towing's trucks at a cost of

$$1,140$; the amount is not yet recorded by Mellor Towing and by agreement will be paid during January of next year.

d$.$ On December $31$ of the current year, property taxes on land owned during the current year were estimated at $$1,410.$

The taxes have not been recorded and will be paid in the next year when billed.

e$.$ On December $31$ of the current year, the company completed towing service for an out$-$of$-$state company for $$7,700$

payable by the customer within $30$ days. No cash has been collected, and no journal entry has been made for this

transaction.

f$.$ On July $1$ of the current year, a three$-$year insurance premium on equipment in the amount of $$900$ was paid and

debited in full to Prepaid Insurance on that date. Coverage began on July $1$ of the current year.

g$.$ On October $1$ of the current year, the company borrowed $$10,800$ from the local bank on a two$-$year, $12$ percent note

payable. The principal plus interest is payable at the end of $24$ months.

h$.$ The income before any of the adjustments or income taxes was $$33,000.$ The company's income tax rate is $30$

percent. $($Hint: Compute adjusted pre$-$tax income based on $($a$)$ through $(g)$ to determine income tax expense.$)$

P$4-3$ Part $2$

Prepare the adjusting entry required for each transaction at December $31$ of the current year.

Note: Round the income tax computation to the nearest dollar. If no entry is required for a transaction$/$event$,$ select $"$No journal

entry required" in the first account field.