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The following items are necessary for preparing the $2026$ year$-$end adjusting entries for Moreno Advertising Agency. Moreno's fiscal

year$-$end is December $31.$

On July $1,2026,$ Moreno received $$5,200$ from a customer for advertising services to be given evenly over the next $10$ months.

At the end of the year, income taxes owed are $$6,200.$ These taxes won't be paid until next April $15.$

On May $1,2026,$ the company paid $$3,840$ for a $2-$year fire and liability insurance policy. The amount was recorded in Prepaid

Insurance on May $1.$

On September $1,2026,$ the company borrowed $$12,000$ from a local bank and signed a note. Principal and interest at $12\%$ will be

paid on August $31,2027.$

At year$-$end, there is a $$2,300$ balance in the Supplies account. Only $$920$ of supplies remains on hand at the end of the year.

Required:

Record the necessary adjusting entries on December $31,2026.$ No prior adjustments have been made during $2026.$

Note: Do not round intermediate calculations. If no entry is required for a particular transaction or event, select $"$No Journal Entry

Required" in the first account field.

Journal entry worksheet

On July $1,2026,$ Moreno received $$5,200$ from a customer for advertising

services to be given evenly over the next $10$ months. Prepare the adjusting

entry at December $31.$

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