PacRim Careers provides training to individuals who pay tuition directly to the business. The business also offers extension training to groups in off-site locations. Additional information available at the December 31, 2020, year-end follows:

1. An analysis of the companys policies shows that $1,180 of insurance coverage has expired.
2. An inventory shows that teaching supplies costing $380 are on hand at the end of the year.
3. The estimated annual depreciation on the equipment is $7,125
4. The estimated annual depreciation on the professional library is $4,185.
5. The school offers off-campus services for specific employers. On November 1, the company agreed to do a special six-month course for a client. The contract calls for a monthly fee of $780, and the client paid the first five months' revenue in advance. When the cash was received, the Unearned Extension Revenue account was credited.
6. On October 15, the school agreed to teach a four-month class for an individual for $1,130 tuition per month payable at the end of the class. The services to date have been provided as agreed, but no payment has been received.
7. The school's two employees are paid weekly. As of the end of the year, three days' wages have accrued at the rate of $130 per day for each employee.
8. The balance in the Prepaid Rent account represents the rent for three months: December, January, and February.

Required: 1. Prepare the necessary annual adjusting journal entries at December 31, 2020, based on (a) to (h) above.

Analysis Component:
2. Complete the adjusted trial balance using the information in (a) through (h) above.

If the adjustments were not recorded, calculate the over- or understatement of income.

Adjustments Dr. Cr. Adjusted Trial Balance Dr. Cr. PACRIM CAREERS Trial Balances December 31, 2020 Unadjusted Trial Balance Account Dr. Cr. Cash $ 17,300 Accounts receivable 0 Teaching supplies 5,800 Prepaid insurance 1,330 Prepaid rent 6,150 Professional library 55,800 Accumulated depreciation, professional library $ 16, 740 Equipment 85,500 Accumulated depreciation, equipment 28,500 Accounts payable 2,150 Salaries payable 0 Unearned extension revenue 5,600 Karoo Ashevak, capital 222,000 Karoo Ashevak, withdrawals 88,500 Tuition revenue 179,690 Extension revenue 65,500 Depreciation expense, equipment Depreciation expense, professional library 0 Salaries expense 199,000 Insurance expense 0 Rent expense 37,000 Teaching supplies expense 0 Advertising expense 13,300 Utilities expense 10,500 Totals $520, 180 $520, 180 Adjustments Dr. Cr. Adjusted Trial Balance Dr. Cr. Account Dr. $ Unadjusted Trial Balance Cr 17,300 0 5,800 1,330 6,150 55,800 $ 16,740 85,500 28,500 2,150 0 Cash Accounts receivable Teaching supplies Prepaid insurance Prepaid rent Professional library Accumulated depreciation, professional library Equipment Accumulated depreciation, equipment Accounts payable Salaries payable Unearned extension revenue Karoo Ashevak, capital Karoo Ashevak, withdrawals Tuition revenue Extension revenue Depreciation expense, equipment Depreciation expense, professional library Salaries expense Insurance expense Rent expense Teaching supplies expense Advertising expense Utilities expense Tntale 5,600 222,000 88,500 179,690 65,500 0 0 199,000 0 37,000 0 13,300 10,500 S520.1801 S520.1801 S ol 0 $ 0 S 0