For each of the following situations, determine the necessary adjustments.
Problem 1. A firm purchased a two-year insurance policy for $6,000 on July 1, 2007. T $6,000 was debited to the prepaid insurance account. What adjustment should be made to record expired insurance on the firm's July 31, 2007,worksheet?
Problem 2. On December 1, 2007, a firm signed a contractwith a local radio station for advertising that will extend over a one-year. The firm paid $5,400 in advance and debited the amount to Prepaid Advertising. What adjustment shouldbe made to record expired advertising on the firm's Decemr 31, 2007, worksheet?