Problem 2-8 (Algo) Adjusting entries (LO2-6) Excalibur Corporation sells video games for personal computers. The unadjusted trial balance as of December 31, 2021, appears below. December 31 is the company's reporting year-end. The company uses the perpetual inventory system Recount Title Debits Credits Cash 23,800 Accounts receivable 33,000 Supplies o Prepaid rent 0 Inventory 70,000 office equipment 68,625 Accumulated depreciation 10,500 Accounts payable 26,600 Salaries payable 3,500 Notes payable 35,000 Common stock 85,000 Retained earnings 13.125 Dividends 7.000 sales revenue 185.000 Coat of goods sold 100,000 Interest expense 0 Salaries expenso 32,050 Rent expenso 14.500 Supplies expende 2,500 Utilities expense 6.500 Totals 358,775 358,775 Information necessary to prepare the year-end adjusting entries appears below. 1. The office equipment was purchased in 2019 and is being depreciated using the straight-line method over an nine-year useful fe with no salvage value. 2. Accrued salaries at year-end should be $5,250. 3. The company borrowed $35.000 on September 1, 2021. The principal is due to be repaid in 12 years. Interest is payable twice a year on each August 31 and February 28 at an annual rate of 12%. 4. The company debits supplies expense when supplies are purchased. Supplies on hand at year-end cost $550. 5. Prepaid rent at year and should be $1,500