Problem 12.2A (Algo) Recording adjustments for accrued and prepaid expense items and unearned income. LO 12-2, 12-3 On July 1 20X1. Tim Stein established his own Financial Services. Selected transactions for the first few days of July follow, DATE TRANSACTIONS 20X1 July 1 Signed a lease for an office and issued Check 101 for $13,050 to pay the rent in advance for six months 1 Borrowed money fron Second National Bank by Issuing a four-month, 6 percent note for $36,000; received 535,280 because the bank deducted the interest in advance. 1 Signed an agreement with Carter Corp. to provide financial services for one year at $9.900 per month; received the entire fee of $70,000 in advance. The 570,800 was credited to Unearned Financial Service Fees 1 Purchased office equipment for $17,000 from Office Outfitters, issued a two month, 12 percent note in payment. The equipnent is estimated to have a useful life of six years and a $1,160 salvage value the equipment will be depreciated using the straight line wethod. 1 Purchased a one-year Insurance policy and issued Check 102 for $1.620 to pay the entire pre 3. Purchased office furniture for $16,900 from Furniture Warehouse issued Check 103 for $8,400 and agreed to pay the balance in 60 days. The equipment has an estimated useful life of five years and a $1,600 salvage value. The office furniture will be depreciated using the straight-line nethod. 5 Purchased office supplies for $1,816 with Check 104. Assume $300 of supplies are on hand Buly 1, 2018 Required: 1. Record the transactions in the general Journal. Assume that the firm initially records prepaid expenses as assets and uneamed income as a liability for the year 20X1 2. Record the adjusting journal entries that must be made on July 31, 20x1. Analyze: What balance should be reflected in Unearned Financial Service Fees on July 31, 20x1? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Analyze Record the adjusting Journal entries that must be made on July 31, 20X1. Vww transaction is Complete this question by entering your answers in the tabs below. Required 1 Required 2 Analyze Record the adjusting journal entries that must be made on July 31, 20x1. View transaction list Journal entry worksheet 1 2 3 4 5 6 7 8 Record an adjusting entry for depreciation on the furniture. Note: Enter debits before credits General Journal Dato Jul 31, 20X1 Debit Credit Record entry Clear entry View general Journal