Unformatted text preview: 112,400 dr Cash, Sept. 30, 2004 34,560 dr Cash, Sept. 30, 2005 12,090 dr 3. Sonora Capital Inc. is preparing year-end adjusting journal entries. On November 1, 2006, Sonora paid for a 6-month insurance policy in effect from November 1, 2006 until April 31, 2007 with a check for $1,200. The company found itself with more office space than it needed, so it rented out a portion of its office building to a start up company, iPops. Due to the risky nature of this business, iPops was required to pay the entire year’s rent in advance. iPops paid for 12 months of rent on December 1, 2006 for the period December 1, 2006 to November 30, 2007 with a check for $18,000. a. Provide the adjusting journal entry that Sonora Capital must make for the insurance policy at their fiscal year end, December 31, 2006. b. Provide the adjusting journal entry that Sonora Capital must make for the office space rental at their fiscal year end, December 31, 2006....
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This note was uploaded on 09/30/2011 for the course ORIE 3150 at Cornell.