On January 1, Donkey Inc. paid $30,000 for insurance for January, February and March. On January 31, unadjusted balances for Prepaid Insurance and Insurance Expense were $30,000 and $0, respectively. Based on this information, (1) analyze the accounting equation effects of the adjustment required on January 31, (2) record the adjusting journal entry, and (3) summarize the effects of the adjusting journal entry in the T-accounts shown below. Analyze Stockholder's Equity Assets Liabilities + Journalize Debit Credit Effect Debit Credit Debit Credit Debit Credit Debit Credit Prepare journal entries to record the transactions, assuming Donkey's Retail Store uses a perpetual inventory system. Nov. 20 28 Sold two items of merchandise to Billy, who paid the $1,000 sales price in cash. The goods cost Donkey's $800. Sold 10 identical items of merchandise to DRV's Gym at a selling price of $10,000 (total); terms 1/10, n/30. The goods cost Donkey's $7,000. DRV's Gym returned two of the items purchased on the 28th. The item was in perfect condition and credit was given to the customer. DRV's Gym paid the account balance in full. 29 Dec. 6 Debit Credit Effect