PROBLEM NO. 2 Recording prepaid expenses and unearned revenues Khaled Co. had the following transactions in the last two months of its year ended December 31. RECORING ENTRIES Nov. 1 Paid $2,950 cash for future newspaper advertising. 1 Paid $2,840 cash for 12 months of insurance through October 31 of the next year. 30 Received $5,600 cash for future services to be provided to a customer. Dec. 1 Paid $3,000 cash for a consultant's services to be received over the next few months. 15 Received $7,950 cash for future services to be provided to a customer. ADJUSTING ENTRIES Required 31 Of the advertising paid for on November 1, $1,200 worth is not yet used. 31 A portion of the insurance paid for on November 1 has expired. This need to be adjusted. 31 Services worth $1,500 are not yet provided to the customer who paid on November 30. 31,One-third of the consulting services paid for on December 1 have been received. 31The company has performed $3,300 of services that the customer paid for on December 15. 31 Depreciation expense on Furniture amounting $2,000 need to be recorded. 31 Rental income for three months amounting $7,500 is earned but still receivable. 31 Utilities expenses amounting $4,000 are incurred for the month of December but Amount is still payable. 1) Prepare recording entries during the year for these transactions under the method that records prepaid expenses and unearned revenues at the time cash is paid or received in the balance sheet accounts. 2) Also prepare adjusting entries at the end of the year.