The information necessary for preparing the December 31, 2021 year-end adjusting entries for Vito's Pizza Parlor appears below. a. On July 1, 2021, purchased $10,000 of IBM Corporation bonds at face value. The bonds pay interest twice a year on January 1 and July 1. The annual interest rate is 12% b Vito's depreciable equipment has a cost of $30,000, a five-year life, and no salvage value. The equipment was purchased in 2019 The straight-line depreciation method is used con November 1, 2021, the bar area was leased to Jack Donaldson for one year Vito's received $6,000 representing the first six months' rent and credited deferred rent revenue. d. On April 1, 2021, the company paid $2,400 for a two-year fire and liability insurance policy and debited insurance expense. e On October 1, 2021, the company borrowed $20,000 from a local bank and signed a note Principal and interest at 12% will be paid on September 30, 2022 At year-end, there is a $1,800 debit balance in the supplies (asset) account. Only 5700 of supplies remain on hand, Required: 1. Prepare the necessary adjusting journal entries at December 31, 2021 2. Determine the amount by which net income would be misstated (Indicate with "Overstatement", "Understatement, i Vito's failed to record these adjusting entries. (Ignore income tax expense) Journal entry worksheet 2 3 5 6 > On July 1, 2021, purchased $10,000 of IBM Corporation bonds at face value. The bonds pay interest twice a year on January 1 and July 1. The annual interest rate is 12%. Note: Enter debits before credits. Transaction General Journal Debit Credit a Record entry Clear entry View general journal Income Overstated (Understated) Adjustments to revenues: Adjustments to expenses $ 0