Rogers Company completed the following transactions during Year 1. Rogers's fiscal year ends on December 31.

Rogers Company completed the following transactions during Year 1. Rogers's fiscal year ends on December 31.

Jan.	8		Purchased merchandise for resale on account. The invoice amount was $14,810; assume a perpetual inventory system.
	17		Paid January 8 invoice.
Apr.	1		Borrowed $66,000 from National Bank for general use; signed a 12-month, 9% annual interest-bearing note for the money.
June	3		Purchased merchandise for resale on account. The invoice amount was $17,320.
July	5		Paid June 3 invoice.
Aug.	1		Rented office space in one of Rogers's buildings to another company and collected six months' rent in advance amounting to $33,000.
Dec.	20		Received a $150 deposit from a customer as a guarantee to return a trailer borrowed for 30 days.
	31		Determined wages of $10,000 were earned but not yet paid on December 31 (disregard payroll taxes).

Required:

1. Prepare journal entries for each of these transactions.

2. Prepare the adjusting entries required on December 31.
 

Explanation:

2.

Interest payable = ($66,000 × 9% × 9/12 = $4,455).

Deferred Rent revenue = ($33,000 × 5/6 = $27,500).

3. Show how all of the liabilities arising from these transactions are reported on the balance sheet at December 31.
 

Explanation:

3. 

Interest payable = ($66,000 × 9% × 9/12 = $4,455).

Deferred rent revenue = ($33,000 × 1/6) = $5,500.

 
4. For each transaction, state whether operating cash flows increase, decrease, or are not affected