Prepare journal entries for each of the above transactions and adjusting items. $($Credit account titles are automatically indented when the

amount is entered. Do not indent manually. If no entry is required, select $"$No Entry" for the account titles and enter O for the amounts. Do not

round intermediate calculations.$)$

No$.$ Account Titles and Explanation

Debit

Credit

Chapati Company started business on January $1,2020.$ Some of the events that occurred in its first year of operations follow:

Transactions

An insurance policy was purchased on February $28$ for $$2,460.$ The insurance policy was for one year of coverage that began

on March $1,2020.$

During the year, inventory costing $$139,000$ was purchased, all on account.

Sales to customers totalled $$208,000.$ Of these, $$43,000$ were cash sales.

Payments to suppliers for inventory that had been purchased earlier totalled $$116,000.$

Collections from customers on account during the year totalled $$150,000.$

Customers paid $$22,000$ in advance payments for goods that will be delivered later.

Equipment that cost $$177,000$ was purchased on October $1$ for $$39,000$ cash plus a two$-$year, $10\%$ note with a principal

amount of $$138,000.($Use Notes Payable$)$

Wages totalling $$40,000$ were paid to employees during the year.

The board of directors declared dividends of $$14,000$ in December $2020,$ to be paid in January $2021.$

Adjusting items

Recorded the insurance expense for the year.

The equipment that was purchased $($in item $7)$ on October $1,2020,$ is to be depreciated using the straight$-$line method, with an

estimated useful life of $10$ years and an estimated residual value of $$20,000.$

Recorded the interest expense on the note payable for the year.

A physical count at year end revealed $$24,500$ of unsold inventory still on hand.

It was determined that $80\%$ of the goods that were paid for in advance $($in item $6)$ had been delivered to the customers by the

end of the year.

In addition to the wages that were paid during the year, wages of $$3,200$ remained unpaid at the end of the year.