Below Are Four Transactions That Were Completed During 20X1 by Doby

question 23

Essay

Below are four transactions that were completed during 20X1 by Doby Company. The annual accounting period ends on December 31. Each transaction will require an adjusting entry at December 31, 20X1. You are to provide the 20X1 adjusting entries required for Doby Company.
A. On July 1, 20X1, Doby Company paid a two-year insurance premium for a policy on its equipment. This transaction was recorded as follows: July 1, 20X1: $$\begin{array} { | l | r | r | } \hline \text { Prepaid insurance } & \$ 1,000 & \\\hline \text { Cash } & & \$ 1,000 \\\hline\end{array}$$ December 31, 20X1--Adjusting entry:
B. On December 31, 20X1 a tenant renting some office space from Doby Company had not paid the rent of $500 for December. December 31, 20X1--Adjusting entry:
C. On September 1, 20X1, Doby Company borrowed $3,000 cash and gave a one-year, 10 percent, note payable. The total interest of $300 is payable on the due date, August 31, 20X2. The note was recorded as follows: September 1, 20X1: $$\begin{array} { | l | r | r | } \hline \text { Cash } & \$ 3,000 & \\\hline \text { Note payable } & & \$ 3,000 \\\hline\end{array}$$ December 31, 20X1--Adjusting entry:
D. Assume Doby Company publishes a magazine. On October 1, 20X1, the company collected $440 for subscriptions two years in advance. The $440 collection was recorded as follows: October 1, 20X1: $$\begin{array} { | l | r | r | } \hline \text { Cash } & \$ 440 & \\\hline \text { Unearned subscription revenues } & & 440 \\\hline\end{array}$$ December 31, 20X1--Adjusting entry:

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Definitions:

Denial

A defense mechanism in which confrontation with a personal problem or with reality is avoided by denying the existence of the problem or reality.

Summer Job

Temporary employment typically taken during the summer months, often by students, to gain work experience or earn money.

Defense Mechanism

Psychological strategies brought into play by individuals or the psyche to manage stress, anxiety, and internal or external demands that are perceived as threatening.

Displacement

In psychology, a defense mechanism involving the transfer of an emotional response from the original object to a safer or more convenient target.