The following transactions and events for Snidemark Manufacturing Corporation are under consideration for adjusting entries at December 31, 2018 (the end of the accounting period) Give the adjusting entry (or entries) that should be made on December 31, 2018, for each item. If an adjusting entry is not required, explain why? a. Machine A in the factory cost $450,000; it was purchased on July 1, 2014. It has an estimated useful life of 12 years and a residual value of $30,000. Straight-line depreciation is used
b. Sales for 2018 amounted to $4,000,000, including $600,000 credit sales. It is estimated, based on experience of the company, that bad debt losses will be 0.25 percent of credit sales (that is .0025 and not .25)
c. At the beginning of 2018, office supplies inventory amounted to $600. During 2018 office supplies amounting to $8,800 were purchased; this amount was debited to office supplies expenses. An inventory of office supplies at the end of 2018 showed $400 on the shelves. The January 1 balance of $600 is still reflected in the office supplies inventory account.
d. On July 1, 2018, the company paid a three-year insurance premium amounting to $2,160; this amount was debited to prepaid insurance.
e. On October 1, 2018, the company paid rent on some leased office space. The payment of $7,200 cash was for the following six months. At the time of payment rent expense was debited for the $7,200.
f. On August 1, 2018, the company borrowed $120,000 from Sharpstown Bank. The loan was for 12 months at 9 percent interest payable at maturity date.
g. Finished goods inventory on January 1, 2018, was $200,000, and on December 31, 2018, it was $260,000. The perpetual inventory record provided the cost of goods sold amount of $2,400,000.