A review of the ledger of Yoda Company at December 31, 2008, produces the following data pertaining to the preparation of annual adjusting entries. 

1. Prepaid Insurance \($8,600.\) The company has separate insurance policies on its buildings and its motor vehicles. Policy B4564 on the building was purchased on July 1, 2007, for \($6,000.\) The policy has a term of 3 years. Policy A2958 on the vehicles was purchased on January 1, 2008, for \($3,600.\) This policy has a term of 2 years. 

2. Unearned Subscriptions \($49,000.\) The company began selling magazine subscriptions in 2008 on an annual basis. The magazine is published monthly. The selling price of a subscription is \($50.\) A review of subscription contracts reveals the following.

3. Notes Payable \($60,000.\) This balance consists of a note for 6 months at an annual interest rate of 9%, dated September 1.

4. Salaries Payable \($0.\) There are eight salaried employees. Salaries are paid every Friday for the current week. Five employees receive a salary of \($500\) each per week, and three employees earn \($750\) each per week. December 31 is a Wednesday. Employees do not work weekends. All employees worked the last 3 days of December.

Instructions

Prepare the adjusting entries at December 31, 2008.

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Subscription Date Number of Subscriptions October 1 200 November 1 300 December 1 480 980