Spring 2022 Exam #2 Problems - Show all work to receive partial credit! Problem 1 (10-15 minutes): ABC Pest Control Co. operates on a calendar year. It is now December 31 and all entries have been made for the year-end financial statements except for the following adjusting journal entries: A) The company continued to use its equipment that was purchased three years ago for $30,000. ABC estimates that the equipment will depreciate $5,000 for this year. Nothing has been recorded yet this year. B) The unadjusted trial balance shows a balance in the supplies account of $6,000, however, when the supplies were counted, only $2,500 of supplies remain. C) ABC received a bill for electricity used in December for $500, the bill is due and will be paid next year. D) ABC received a discount if they purchased insurance in advance so they paid $24,000 cash for a two year policy on January 1st, with coverage starting on January 1. Except for the purchase, no other entries have been made to date. E) ABS provided $3,000 of services to clients in December, but ABC will not bill the clients until next year. F) A customer paid ABC $1,200 on December 1st for monthly pest control services for an entire 12 month period with services starting on December 1st. Except for the initial transaction on December 1, no other transactions have been recorded. Required (25 points): Prepare the required adjusting entries for the above transactions for year ended December 31. Follow the format used in class (including indicated after each account, the type of account and whether it increases or decreases). B A