The unadjusted trial balance of Clancy Inc. at December 31, 2014, is as follows:

Additional information:
1. Actual advertising costs amounted to$1,500 per month. The company has already paid for advertisements in Montezuma Magazine for the first quarter of201 5.
2. The building was purchased and occupied on January I, 2012, with an estimated useful life of 20 years, and residual value of$30,000. (The company uses straight-line depreciation.)
3. Prepaid insurance contains the premium costs of several policies including Policy A, cost of $2,640, one-year term, taken out on September I, 2014; and Policy B, cost ofSI,980, three-year term, taken out on April1, 2014.
4. A portion of Clancy's building has been converted into a snack bar that has been rented to the Ono Food Corp. since July I, 2013, at a rate of $7,200 per year payable each July I.
5. One of the company's customers declared bankruptcy on December 30, 2014. It is now certain that the $2,700 the customer owes will never be collected. This fact has not been recorded. In addition, Clancy estimates that 4% of the Accounts Receivable balance on December 31, 2014, will become uncollectible.
6. An advance of $600 to a salesperson on December 31, 2014, was charged to Salaries and Wages Expense.
7. On November I, 2012, Clancy issued 180 $ 1,000 bonds at par value. Interest is paid semi-annually on April 30 and
October 31.
8. The equipment was purchased on January 1, 2012, with an estimated useful life of 12 years, and no residual value.
(The company uses straight-line depreciation.)
9. On August I, 2014, Clancy purchased at par value 40 $1,000, 9% bonds maturing on July 31, 2016. Interest is paid on July 31 and January 31.
10. The inventory on hand at December 31, 2014, was $90,000 after a physical inventory count.
Instructions
(a) Prepare adjusting and correcting entries for December 31,2014, using the information given. Record the adjusting entry for inventory using a Cost of Goods Sold account.
(b) Indicate which of the adjusting entries could be reversed.

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Debit Credit $17,740 103,000 Cash Accounts receivable Allowance for doubtful accounts Inventory Prepaid insurance Bond Investment at Amortized Cost Land Building Accumulated depreciation-building Equipment Accumulated depreciation-equipment Goodwill Accounts payable Bonds payable (20-year, 7%) Common shares Retained earnings Sales revenue Rent revenue Advertising expense Supplies expense Purchases $3,500 60,000 4,620 40,000 30,000 154,000 12,400 33,600 5,600 16,600 101,050 180,000 121,000 21,360 200,000 10,800 22,500 10,800 98,000 Debit Credit Purchase discounts Salaries and wages expense Interest expense 900 53,500 12,250 $656,610 $656,610