In July 2000, Reynolds Company received a bill from the county government for property taxes on its land and buildings for the period July 1, 1999, through June 30,2000 . The amount of the tax bill is $\$ 7,600$, and payment is due August 1,2000 The tax rate for the period July 1, 2000, to June 30, 2001, will not change, and the company does not plan to acquire any additional taxable assets during that period. Reynolds Company uses the calendar year for financial reporting purposes.

1. Prepare the journal entries to record payment of the property taxes on August 1, 2000, assuming no entry has been made to record a liability for the property taxes.

2. Prepare the adjusting entry for property taxes on December 31,2000 .