Question

1. Gomez Co. had the following transactions in the last two months of its year ended December 31st Nov. 1st Paid $1,900 cash for future newspaper advertising
1st Paid $2,460 cash for 12 months of insurance through October 31st of the next year.
30th Received $3,700 cash for future services to be provided to a customer.
Dec. Ist Paid $6,000 cash for a consultant's services to be received over the next three months.
15 Received $7,950 cash for future services to be provided to a customer
31st Of the advertising paid for on November 1st, $1,500 worth is not yet used
31st A portion of the insurance paid for on November 1st has expired. No adjustment was made in November to Prepaid Insurance
31st Services worth $1,500 are not yet provided to the customer who paid on November 30.
31st One-third of the consulting services paid for on December 1st have been received.
31st The company has performed $3,400 of services that the customer paid for on December 15th.

Answer 1

Gomez Co.
Journal entries
Date	Account	Debit	Credit	Calculation
1-Nov	Prepaid Advertising	$        1,900
	Cash		$        1,900
1-Nov	Prepaid Insurance	$        2,460
	Cash		$        2,460
30-Nov	Cash	$        3,700
	Unearned Service Revenue		$        3,700
1-Dec	Prepaid Consulting Expenses	$        6,000
	Cash		$        6,000
15-Dec	Cash	$        7,950
	Unearned Service Revenue		$        7,950
Adjusting entries
31-Dec	Advertising expense	$           400		'=1900-1500
	Prepaid Advertising		$           400
31-Dec	Insurance expense	$           410		'=2460 / 12*2
	Prepaid Insurance		$           410
31-Dec	Unearned Service Revenue	$        2,200
	Service Revenue		$        2,200
31-Dec	Consulting Expenses	$        2,000		'=6000 / 3
	Prepaid Consulting Expenses		$        2,000
31-Dec	Unearned Service Revenue	$        3,400
	Service Revenue		$        3,400