Required:

Explain, in good form, how you arrive at the amount and prepare the adjusting entries at December 31, 20X0.

A review of the ledger of Luckin Company at December 31, 20X0, the accountant gathers the following data pertaining to the preparation of annual adjusting entries. (a) Salaries and Wages have not been accrued. There are eight salaried employees. Salaries are paid every Friday for the current week. Five employees receive a salary of 800 each per week, and three employees 500 per week. Assume December 31 is a Tuesday. Employees do not work weekends. All employees worked the last 2 days of December (b) Unearned Rent Revenue 324,000. The company began subleasing office space in its new building on November 1. At December 31, the company had the following rental contracts that are paid in full for the entire term of the lease. Term No. of Date (in months) Monthly Rent Lease Nov. 1 6 4,000 5 Dec. 1 6 8,500 4 (c) Prepaid Advertising 15,600. This balance consists of payments on two advertising contracts. The contracts provide for monthly advertising in two trade magazines. The terms of the contracts are as follows. No. of Contract Date Amount Magazine Issues A650 May 1 6,000 12 B974 Oct. 1 9,600 24 (d) Notes Payable 100,000. This balance consists of a note for one year at an annual interest rate of 9%, dated June 1, 20X0