Miranda's Motor Mechanics analysed the accounting records and other data for the business. The following information is made available for the year ended 30 June 2019.

1. Salaries and wages owing to employees at the end of the financial year amounted to $2480.

2. Included in the Prepaid Rent account is an amount of $1600 paid in June for the month of July 2019. The Prepaid Rent account has a debit balance of $4800.

3.All equipment had been acquired when the business was established on 1 July 2016. The Equipment account has a debit balance of $142000. The equipment has a useful life of 10years and an estimated residual value of $6000.

4.The Motor Vehicle account has a debit balance of $80000. The vehicle was purchased on 1January 2019 and has an estimated useful life of 5 years and an estimated residual value of $10000.

5.The Prepaid Insurance account has a debit balance of $3444. It consists of the following policies purchased during the financial year ending 30 June 2019.

Policy number

Date of policy

Life of policy

Premium paid

GTX 9847

1 August 2018

1 year

$ 876

KLM 9043

1 December 2018

2 years

2 016

PAR 2178

1 March 2019

6 months

552

6.A physical count of office supplies on hand at 30 June gives a total of $890. The Office Supplies account has a debit balance of $2920.

7.Included in the Prepaid Advertising account balance of $8400 is the amount of $1650 paid to the local newspaper for advertising space in their July 2019 papers. The remainder of the balance is used up by 30 June 2019.

8. A t the end of the year, the business had an outstanding longterm loan of $40000 from one of Miranda's friends. Interest of 8% p.a. is payable halfyearly on this loan, every 1 April and 1 October. The last interest payment made by the business was on 1 April 2019.

9.The Motor Mechanic Services Revenue account has a credit balance of $123600. Included in this amount is $3280 for services to be provided in July 2019.

10. A ccrued council rates at 30 June 2019 were $4200.

Required

(a) Prepare the endofperiod adjusting entries required on 30 June 2019. Show clearly your calculations.

(b) Provide reasons for your answers to items 2, 4 and 8 above.