Johnny Knox is the new owner of Swift Computer Services. At the end of July 2012, his first month of ownership, Johnny is trying to prepare monthly financial statements. He has the following information for the month.
1. At July 31, Knox owed employees $1,300 in salaries that the company will pay in August.
2. On July 1, Knox borrowed $20,000 from a local bank on a 10-year note. The annual interest rate is 12%.
3. Service revenue unrecorded in July totaled $2,400.
Prepare the adjusting entries needed at July 31, 2012.