[The following information applies to the questions displayed below.] On December 1, Year 1. John and Patty Driver formed a corporation called Susquehanna Equipment Rentals. The new corporation was able to begin operations immediately by purchasing the assets and taking over the location of Rent-lt. an equipment rental company that was going out of business. The newly formed company uses the following accounts. The corporation performs adjusting entries monthly. Closing entries are performed annually on December 31 . During December of its first year of operations, the corporation entered into the following transactions. Dec. 1 Issued to John and Patty oriver 25 , gee new shares in exchange for a total of $256, ,6ee cash. Dec. 1 Purchased for $249,690 all of the equipment formerly owned by Rent-It. Paid $131,660 cash and issued a 1-year note payable for $118,690. The note, plus all 12 morths of accrued interest, are due novenber 3o, Year 2. Dec. 1 Paid $19, bee to shapiro Realty as three months' advance rent on the rental yard and office formerly occupied by Rent-It. Dec. 4 Purchased office supplies on account from iodern office Co., \$1, ee. Payment due in 30 days. (These supplies are expected to last for several months; debit the office supplies asset acoount.) Dec. G Received $8,260 cash as advance payment on equipment rental from Mkkamer Construction Company. (Credit Lnearned Rental Fees.) Dec. 2 Paid salaries of $5,200 for the first two weeks in Decenber. Dec. 15 excluding the MeNamer advance, equipment rental fees earned during the first 15 days of Decenber ambunted to $18, 2ce, of which $12, gee was received in cash. Dec. F Purchased on acoount from Earth Movers, Inc., \$we in parts needed to perform basic maintenance on a rental tractor. Payment is due in 19 days. Dec.23 collected $2,260 of the acoounts receivable reorded on Decenber 15. Dec.26 Rented a backhoe to iassion Landscaping at a price of \$3e0 per day, to be paid when the backhoe is returned. Mission Landscaping expects to keep the backhoe for about two or three waeks. Dec.26 Paid biineekly salaries, \$5,260. Dec.27 Paid the acoount payable to Earth Movers, Inc., \$2ee. Dec.26 Declared a dividend of 10 cents per share, payable on January 15, Year 2. Dec. 2 susquehanna Equipment Rentals was named, along with icission Landscaping and collier construction, as a oo-defendant in a $39, eee lavsuit filed on behalf of kevin Davenport. Mission Landscaping had left the rented backhoe in a fenced construction site cammed by collier construction. After working hours on Decenber 26, 0avenport had clinbed the fence to play on parked construction equipment. Hhile playing on the backhoe, he fell and broke his arm. The extent of the company's legal and financial responsibility for this accident, if any, cannot be determined at this time. (wote: This event does not require a journal entry at this time, but may require disclosure in notes acoompanying the statements.) Dec. 29 Purchased a 12 -month public liability insurance policy for q9,6es. This policy protects the company ogainst liability for injuries and property damege caused by its equipment. However, the policy poes into effect on January 1, Year 2 , and affords no coverze for the injuries sustained by kevin Davenport on Decenber 26. Dec.31 Received a bill from Universal Utilities for the morth of Decenber, \$e. Payment is due in wo days. Dec.31 Equipment rental fees earned during the second half of Decenber amrunted to $29, 5ee, of which $16, 36e was received in cash. Date for Acljusting Entres In Year 1 a. The advance payment of rent on December 1 covered a period of three months. b. The annua interest rate on the note payable to Rent-lt is 6 percent. c. The rental equipment is being depreciated by the straight-line method over a period of eight years. Any salvage value at the end of its useful life is expected to be negligible and immaterial. d. Office supplies on hand at December 31 are estimated at $670. e. During December, the company earned $4,100 of the rental fees paid in advance by McNamer Construction Company on December 8. f. As of December 31, six days' rent on the backhoe rented to Mission Landscaping on December 26 has been earned. g. Salaries earned by employees since the last payroll date (December 26 ) amounted to $1,100 at month-end. h. It is estimated that the company is subject to an income tax rate of 30 percent of profit before income taxes itotal revenue minus all expenses other than income taxes.. These taxes will be payable in Year 2. repare an after-closing trial balance as of December 31 . (Round your tinal anwers to the nearest whole collar.)