Problem 12.1A (Static) Recording adjustments for accrued and prepaid items and unearned income. LO 12-2, 12-3 a.-b. Merchandise Inventory, before adjustment, has a balance of $7,800. The newly counted Inventory balance is $8,300. c. Unearned Seminer Fees has a balance of $6,300, representing prepayment by customers for five seminars to be conducted in June, July, and August 20X1. Two seminars had been conducted by June 30, 20X1. d. Prepeld Insurance has a balance of $13,800 for six months' Insurance paid in advance on May 1, 20x1. e. Store equipment costing $6,530 was purchased on March 31, 20X1. It has a salvage value of $530 and a useful life of five years. f. Employees have earned $280 that has not been paid at June 30, 20X1. g. The employer owes the following taxes on wages not paid at June 30, 20X1: SUTA, $8.40; FUTA, $1.68, Medicare, $4.06; and social security. $17.36. h. Management estimates uncollectible accounts expense at 1 percent of sales. This year's sales were $2,300,000. 1. Prepeld Rent has a balance of $7.050 for six months' rent paid in advance on March 1, 20X1. J. The Supplies account in the general ledger has a balance of $430. A count of supplies on hand at June 30, 20X1, Indicated $165 of supplies remain. k. The company borrowed $4,800 from Second Bancorp on June 1, 20X1, and issued a four-month note. The note bears interest at 9 percent Required: Based on the Information above, record the adjusting journal entries that must be made for Kisling Distributors on June 30. 20X1. The company has a June 30 fiscal year-end. Analyze: After all adjusting entries have been journalized and posted, what is the balance of the Prepaid Rent account?