Porser Company had the following balances in the accounting records as of December 31, Year 1:

Assets Claims

Cash $26,000 Accounts payable $5,000

Accounts Receivable 9,000 Common stock 28,000

Land 42,000 Retained earnings 44,000

Total $77,000 Total 77,000

The following accounting events apply to Porser Companys Year 2 fiscal year:

Jan. 1 Acquired $15,000 cash from the issue of common stock.

1 Purchased a truck that cost $22,000 and had a $2,000 salvage value and a

four-year useful life.

Feb 1 Borrowed $12,000 by issuing a note that had a 9 percent annual interest

rate and a one-year term.

1 Paid a $3,000 cash in advance for a one-year lease for office space.

Mar 1 Paid a $2,000 cash dividend to the stockholders.

April 1 Purchased land that cost $28,000 cash.

May 1 Made a cash payment on accounts payable of $4,000.

July 1 Received $5,400 cash in advance as a retainer for services to be performed

monthly over the next 12 months.

Sept 1 Sold land for $42,000 that originally cost $42,000

Oct 1 Purchased $5,000 of supplies on account.

Dec 31 Earned $42,000 of service revenue on account during the year.

31 Received cash collections from accounts receivable amounting to $40,000.

31 Incurred other operating expenses on account during the year that amounted to $6,000.

31 Incurred accrued salaries expense of $5,200.

31 Had $200 of supplies on hand at the end of the period.

Required

Based on the preceding information, answer the following questions. All questions pertain to the Year 1 financial statement. (Hint: Enter items in general ledger accounts under the accounting equation before answering the questions.)

1. Based on the preceding transaction, identify four additional adjustments and describe them.