Make the appropriate adjusting entries

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Question - Make the appropriate adjusting entries in the situations below.

1. The company has a machine with a cost of $60,000 which it bought in prior years. Depreciation expense should be $2,000 per month. No depreciation has been recorded yet this month.

2. Four months ago, the company bought prepaid insurance for 24 months for a total price of $48,000. The company has been recognizing some insurance expense each month. An entry is needed this month to record the insurance expense.

3. The company loaned another company $100,000 at an interest rate of 6% per year. No interest is due to be paid this month, but an entry is needed to record the interest earned during this month.

4. The company has bonds payable of $12,000,000, with an effective interest rate of 4% per year. An entry is needed to accrue the interest expense and interest payable for this month.

Reference no: EM133179742

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