Sparkling Jewels estimated its payroll for the coming year to be $84,000. Its workers' compensation insurance premium rate of 0.6% is paid at the beginning of each quarter.

Required:

1.

Calculate the estimated cost of workers' compensation insurance for the year.

2.

Show the journal entry for the total payment on January 2, 20--.

3.

Assume Ryan's actual payroll for the year was $89,000. Calculate the additional premium owed for 20--. Record the adjustment needed on December 31, 20--. The actual payment of the additional insurance premium will not take place until January of the following year.