Part $1$: Adjusting Journal Entries

Your first task is to prepare the required adjusting journal entries for the year ended

December $31,2024,$ for the following scenarios. For each entry, clearly state the date,

the accounts and amounts to be debited and credited, with a brief explanation of each

entry.

Interest of $$2,000$ has been incurred on the long$-$term note payable. Nothing has

been recorded as of December $31.$ The interest payment will be made in

January $2025.$

Salaries amounting to $$10,000$ are owed to employes as of December $31,$ to be

paid in the first week of January $2025.$

Coastal paid $$24,000$ for a one$-$year insurance policy on April $1,2024.$

At the beginning of $2024,$ Coastal had $$5,000$ in supplies. During the year, the

company purchased an additional $$8,000$ in supplies. At year$-$end, only $$2,500$ of

supplies remained on hand.

The company received $$20,000$ on December $1,2024,$ for services to be

provided evenly over a six$-$month period.

Equipment of $$100,000$ was purchased on January $1,2024,$ with an estimated

useful life of $10$ years and no salvage value. The company uses straight$-$line

depreciation for this type of asset.

The company acquired a patent on July $1,2024,$ for $$40,000,$ with a useful life of

$8$ years. The company uses straight line amortization for such assets.

Coastal prepaid $$18,000$ for six months of rent on November $1,2024.$

The company mistakenly recorded inventory purchases of $$15,000$ as repairs

expense.

The utility bill for December, estimated at $$1,500,$ was not received by year$-$end.

Coastal estimates its year$-$end income taxes will be $$10,000,$ payable in March