or Note: Evervrise E3 26 should be used only in conjunction with Exercise E3-2 E3-26 Preparing an adjusted trial balance Refer to the data in Exercise E3-25, and prepare an adjusted trial balance E3-27 Identifying the impact of adjusting entries on the financial statements Austin Acoustics recorded the following transactions during October: a. Received $2,500 cash from customer for three months of service beginning October 1 and ending December 31. The company recorded a $2,500 debit to b. Employees are paid $3,000 on Monday following the five-day workweek. October c. The company pays s440 on October 1 for its six-month auto insurance policy. The Cash and a $2,500 credit to Unearned Revenue. 31 is on Friday. company recorded a $440 debit to Prepaid Insurance and a $440 credit to Cash. d. The company purchased office furniture for $8,300 on January 2. The company recorded a $8,300 debit to Office Furniture and an S8,300 credit to Accounts e. The company began October with $50 of office supplies on hand. On October 10, the company purchased office supplies on account of S100. The company recorded a $100 debit to Office Supplies and a $100 credit to Accounts Payable. The company received its electric bill on October 31 for $325 but did not pay it g. The company paid November's rent of $2,500 on October 30. On October 30, the The company used $120 of office supplies during October. f. until November 10. company recorded an $2,500 debit to Rent Expense and a $2,500 credit to Cash. Indicate if an adjusting entry is needed for cach item on October 31 for the month of October. Assuming the adjusting entry is not made, indicate which specific category or categories of accounts on the financial statements are misstated and if they are overstated or understated. Use the following table as a guide. Item ais completed as an example: Specific Category of Balance Sheet Liability Specific Category of Accounts on the Adjusting Entry Accounts on the Over / Understated Income Statement Understated Over / tem Needed? (a) Yes Revenue Over Under Under uf -28 Journalizing adjusting entries and analyzing their effect on the income statement The following data at July 31, 2018, are given for RCO: a. Depreciation, $600 b. Prepaid rent expires, $200 c. Interest expense accrued, $700