Question

What are the adjusting entries for the following?

1	Accrue interest expense on the note assuming that the date of the loan was January 2 (use 30/360 and round to the nearest dollar).
2	Supplies on hand at January 31 total $200.
3	Assume that all of the equipment was purchased at the beginning of January. Record January depreciation expense using the straight-line method (round to the nearest dollar).
4	The cash advance is earned ratably over the 5-month period.
5	The company has earned $330 of revenue that has not yet been billed to customers.
6	Jackson pays its employees on the first of every month. Salaries earned during the month of January total $2,060.
7	On January 29, Jackson received the current month's utility bill for $150. The bill is due on February 16.
8	Jackson estimates that the company will pay an income tax rate of 11%.

These are the orginial events that took place, and their journal entries

Issued common stock in exchange for $4,000 cash.
Borrowed $5,000 by issuing a 2-year, 10% note payable to SunTrust Bank.
Paid $900 for January rent.
Purchased supplies on account for $450 from Traveler's Supply Company.
Purchased equipment for $7,200 cash from DSI Computer Company. The equipment has a 3 year life and a $1,200 salvage value.
Purchased additional equipment from Bebo's Office Supply Co., paying cash of $1,350 and putting $1,500 on account. The equipment has a 5 year life and $450 salvage value.
Paid $125 for advertisements to run in the current month and $375 for ads to run in February-April.
Paid the January insurance premium of $225.
Performed services for $2,625 cash.
Received cash advance of $5,125 for services to be performed on a 5- month contract beginning in January.
Performed services and billed customers $1,500.
Made a $600 payment on account to Traveler's Office Supply Company .
Collected $1,300 from customers on account.
Declared and paid dividends of $1,000 cash.

1-Jan	Cash	4,000
	Common Stock		4,000
2-Jan	Cash	5000
	Notes Payable		5000
3-Jan	Rent Expense	900
	Cash		900
4-Jan	Supplies	450
	Accounts Payable		450
5-Jan	Equipment	7200
	Cash		7200
6-Jan	Equipment	2850
	Cash		1350
	Accounts Payable		1500
7-Jan	Prepaid Advertisement	375
	Advertisement Expense	125
	Cash		500
8-Jan	Insurance Expense	225
	Cash		225
9-Jan	Cash	2625
	Service Revenue		2625
10-Jan	Cash	5125
	Unearned Service Revenue		5125
11-Jan	Cash	1500
	Accounts Receivable		1500
12-Jan	Accounts Payable	600
	Cash		600
13-Jan	Cash	1300
	Accounts Receivable		1300
14-Jan	Dividends	1000
	Cash		1000

There are no opening balances

Answer 1

Adjusting Entries

Date	Particulars	Debit	Credit
31-Jan	Interest Expense Dr	42
	To Interest Payable		42
	Profit and Loss a/c Dr	42
	To Interest expense a/c		42
31-Jan	Closing Stock a/c Dr	200
	To Trading account		200
31-Jan	Depreciation Expense a/c Dr	207
	To Equipment (1)		167
	To Equipment (2)		40
	Profit and Loss A/c Dr	207
	To Depreciation Expense		207
31-Jan	Unearned Service Revenue a/c Dr	1025
	To Service Revenue		1025
	Service Revenue a/c Dr	1025
	To Profit and Loss a/c		1025
31-Jan	Accrued Revenue a/c Dr	330
	To Service Revenue		330
	Service Revenue a/c Dr	330
	To Profit and Loss a/c		330
31-Jan	Accrued Salaries a/c Dr	2060
	To Salary A/c		2060
	Profit and Loss a/c Dr	2060
	To Salaries A/c		2060
31- Jan	Utilities expense a/c Dr	150
	To Accrued Utilities a/c		150
	Profit and Loss a/c Dr	150
	To Utilities Expense a/c		150
31-Jan	Income Tax a/c Dr	2.31
	To Income tax payable a/c		2.31

Assumptions

No accumulated dereciation is maintained.

Workings

A) Depreciation

Equipment 1: (7200-1200)/3*1/12 = 167

Equipment 2 : (1350+1500-450)/5*1/12 = 40

B) Interest Expense

5000*10%*1/12 = 42