Textbook Problem

Classifying adjusting entries

The following accounts were taken from the unadjusted trial balance of Murray Co., a congressional lobbying firm. Indicate whether or not each account would normally require an adjusting entry. If the account normally requires an adjusting entry, use the following notation to indicate the type of adjustment:

AE—Accrued Expense

AR—Accrued Revenue

PE—Prepaid Expense

UR—Unearned Revenue

To illustrate, the answer for the first account follows: