For each of the following situations, prepare the adjusting entry for the month ended February 28 and indicate the effect each adjustment would have on net income:
A. On February Doan Company received a $6,000 retainer from a client. By the end of February, Doan had earned $4,500 of the retainer.
B. During January, $24,000 in magazine subscriptions was received by MG Corp. The subscriptions were for l2 monthly issues of Summer Sport, beginning with the month of February. MG Corp. prepares monthly financial statements.
C. Weisz Insurance Company sells policies that run on s calendar-year basis. It sold $60,000 of insurance policies and collected the cash in early January. Weisz prepares monthly financial statements.