Penny's Pool Service \& Supply Inc. (PPSS) is completing the accounting process for the first year of operations ended on December 31. Transactions during the year have been journalized and posted. Additional information for the adjusting entries: a. PPSS owed $1,500 wages to the office receptionist and three assistants for working the last two days in December. The employees will be paid in January of the next year. b. On October 1 of the current year, PPSS received $24,000 from customers who prepaid pool cleaning service for one year beginning on November 1 of the current year. c. The company received a $520 utility bill for December utility usage. It will be paid early next year. d. PPSS borrowed $59,000 from a local bank on May 1 of the current year, signing a note with a 6 percent interest rate. The note and interest are due on May 1 of the next year. e. On December 31 of the current year, PPSS cleaned and winterized a customer's pool for $800, but the service was not yet recorded on December 31. f. On February 1 of the current year, PPSS purchased a two-year insurance policy for $4,200, with coverage beginning on that date. The amount was recorded as prepaid insurance when paid. g. On December 31 of the current year, PPSS had $3,100 of pool cleaning supplies on hand. During the year, PPSS purchased supplies costing $25,400 from Pool Corporation Inc. h. PPSS estimated that depreciation on its buildings and equipment was $8,300 for the year. i. At December 31 of the current year, $110 of interest on investments was earned that will be received in the next year. j. The company's income tax rate for the year was 30 percent. Required: 1. Prepare adjusting entries for Penny's Pool Service \& Supply Inc. on December 31 of the current year. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Penny's Pool Service \& Supply Inc. (PPSS) is completing the accounting process for the first year of operations ended on December 31. Transactions during the year have been journalized and posted. Additional information for the adjusting entries: a. PPSS owed $1,500 wages to the office receptionist and three assistants for working the last two days in December. The employees will be paid in January of the next year. b. On October 1 of the current year, PPSS received $24,000 from customers who prepaid pool cleaning service for one year beginning on November 1 of the current year. c. The company received a $520 utility bill for December utility usage. It will be paid early next year. d. PPSS borrowed $59,000 from a local bank on May 1 of the current year, signing a note with a 6 percent interest rate. The note and interest are due on May 1 of the next year. e. On December 31 of the current year, PPSS cleaned and winterized a customer's pool for $800, but the service was not yet recorded on December 31. f. On February 1 of the current year, PPSS purchased a two-year insurance policy for $4,200, with coverage beginning on that date. The amount was recorded as prepaid insurance when paid. g. On December 31 of the current year, PPSS had $3,100 of pool cleaning supplies on hand. During the year, PPSS purchased supplies costing $25,400 from Pool Corporation Inc. h. PPSS estimated that depreciation on its buildings and equipment was $8,300 for the year. i. At December 31 of the current year, $110 of interest on investments was earned that will be received in the next year. j. The company's income tax rate for the year was 30 percent. Required: 1. Prepare adjusting entries for Penny's Pool Service \& Supply Inc. on December 31 of the current year. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
