. The Adjusting Company, which opened business on June 1, 2014, have given you a portion of their first adjusted trial balance as of June 30, 2014.

Adjusting Company

Unadjusted Trial Balance

June 30, 2014

Debit Balance Credit Balance

Prepaid Insurance $ 3,600

Supplies 2,450

Unearned Revenue $3,600

a.Regarding; Prepaid Insurance

i.In your own words create an adjusting transaction that will require an adjusting journal entry

ii.Based on your adjusting transaction, prepare the correct journal entry

iii.Based on your journal entry explain how the income statement was effected

b. Regarding; Supplies

i.In your own words create an adjusting transaction that will require an adjusting journal entry

ii.Based on your adjusting transaction, prepare the correct journal entry

iii.Based on your journal entry explain how the balance sheet was effected

c. Regarding; Unearned Revenue

i.In your own words create an adjusting transaction that will require an adjusting journal entry

ii. Assume that the company forgot to prepare an adjusting journal entry for the transaction, explain what is wrong with the balance sheet.