a. At year-end, employees earned wages of $4,000, which will be paid on the next payroll date in January of next year — Refer E4-3 and E4-5

Refer to E4-3 and E4-5.

E4-3

Diane Company completed its first year of operations on December 31. All of the year's entries have been recorded except for the following:

a. At year-end, employees earned wages of $4,000, which will be paid on the next payroll date in January of next year.

b. At year-end, the company had earned interest revenue of $1,500. The cash will be collected March 1 of the next year.

E4-5

Aubrae Company is making adjusting entries for the year ended December 31 of the current year. In developing information for the adjusting entries, the accountant learned the following:

a. A two-year insurance premium of $4,800 was paid on October 1 of the current year for coverage beginning on that date. The bookkeeper debited the full amount to Prepaid Insurance on October 1.