The following summary transactions occurred during the year 2018:

1. Sales to customers totaled $30,000 of which $16,000 were on credit and the remainder was cash sales. Cost of goods sold totaled $8,000.

2. Purchased $7,000 inventory on credit.

3. Paid $6,200 cash for salaries.

4. Collected $17,500 cash from credit customers.

5. Paid $9,000 cash to suppliers of inventory.

6. Paid cash $4,500 for purchase of equipment on January 1, 2018. The equipment has a useful life of

5. years and zero salvage value.

7. Paid cash for miscellaneous expenses for 2018 of $2,800, and for insurance for 2018 of $500.

8. Paid cash for flood damage to rented premises amounting to $8,050, of which $3,000 was recoverable from insurance in March 2019. The company considers such losses to be non-recurring in nature and labels them Non-recurring losses.

At December 31, 2018, the following information is available:

1. Accrued salaries at December 31, 2018 are $1,200.
2. Interest on bonds payable has not been paid during 2018.
3. $1,800 of prepaid rent related to the rent for 2018.
4. The company uses straight-line depreciation. The equipment purchased before 2018 has an estimated useful life of 10 years and zero residual value.
5. The company's effective tax rate is 40%, applicable to all items. No tax was paid during 2018.

Required:

1. Show all journal entries.

Presented below is the balance sheet of Sandusky Corporation for the year ended December 31, 2017. Assets Liabilities & Owners' Equity Current Assets: Cash Accounts Receivable Inventory Prepaid Rent $ 8,130 5,640 7,200 2,220 23,190 Current Liabilities: Accounts Payable Accrued Salaries Interest Payable $5,530 1,690 600 7,820 10% Bonds Payable 4,000 Fixed Assets: Owners' Equity Common Stock (at $ par) Additional Paid-in Capital Retained Earnings Equipment (Cost) 14,400 Accumulated Depreciation (2,880) Equipment (Net) 11,520 8,000 12,000 2,890 22,890 Total 34,710 Total 34,710