Acc280 Financial Accounting: E3-17 At Natasha Company, prepayments are debited

Acc280 Financial Accounting

E3-17
At Natasha Company, prepayments are debited to expense when paid, and unearned revenues are credited to revenue when received. During January of the current year, the following transactions occurred.

Jan. 2 Paid $1,800 for fire insurance protection for the year.
Jan. 10 Paid $1,700 for supplies.
Jan. 15 Received $6,100 for services to be performed in the future.

On January 31, it is determined that $2,500 of the services fees have been earned and that there are $800 of supplies on hand.

Instructions
(a) Journalize and post the January transactions. (Use T accounts.)
(b) Journalize and post the adjusting entries at January 31.
(c) Determine the ending balance in each of the accounts.
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