Question

Consider the following transactions for Huskies Insurance Company: Equipment costing $30,000 is purchased at the beginning of the year for cash. Depreciation on the equipment is $5,000 per year. On June 30, the company lends its chief financial officer $30,000; principal and interest at 5% are due in one year. On October 1, the company receives $8,000 from a customer for a one-year property insurance policy. Deferred Revenue is credited. Required: For each item, record the necessary adjusting entry for Huskies Insurance at its year-end of December 31. No adjusting entries were made during the year. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field. Do not round intermediate calculations.)

Answer 1

Date	Account title	Debit	Credit
Dec. 31	Depreciation expense	5,000
	Accumulated depreciation-Equipment		5,000
Dec. 31	Interset receivable	750
	Interest revenue (30,000x5% x 6/12)		750
Dec. 31	Deferred revenue	2,000
	Revenue earned (8,000x3/12)		2,000