The Trial balance before adjustments for Snowcrest Ltd. for Dec 31, 2014, is presented below.

	Debit Balances	Credit Balances
Cash	10,000
Inventory	24,000
Advances to salespeople (Prepaid sales commissions)	2,000
Office supplies	3,000
Equipment	56,000
Accumulated depreciation equipment		4,000
Deposits from customers (Revenue received in advance)		6,000
Bank loan		20,000
Common shares		40,000
Retained earnings		9,000
Sales revenue		230,000
Cost of goods sold	130,000
Sales commissions	34,000
Office salaries	25,000
Rent expense	6,500
Miscellaneous expenses	15,000
Dividends declared	3,500
Totals	$309,000	$309,000

Data for adjusting entries (The Company adjusts its accounts annually):

Required: Prepare the adjusting entries for items listed below:

1. On December 31, 2014, 80% of the commissions that had been paid in advance to the salespeople had been earned by them.

2. A count of the office supplies at the end of the year revealed that $800 of supplies were still on hand.

3. Depreciation on the equipment for 2014 was $1,400.

4. The deposits from customers had been received as advance payments for future deliveries of goods. By December 31, 2014, one-third of these deliveries had been made.

5. The bank loan was a six-month loan taken out on Oct 1, 2014. The interest rate on the loan is 10%, but the interest is not due to be paid until the note is repaid on March 1, 2015.

6. $600 of office salaries were owed at year end but had not yet been recorded.

7. The rent expense figure includes $500 that had been paid in advance for January 2015.

8. Income tax for the year should be calculated using a tax rate of 25%. (Hint: after you finish the other adjusting entries, you will have to determine the income before income tax and calculate the tax as 25% of this amount.).