1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Shtirlitz [24]
3 years ago
13

During the course of your examination of the financial statements of the Hales Corporation for the year ended December 31, 2021,

you discover the following:
a. An insurance policy covering three years was purchased on January 1, 2021, for $6,600. The entire amount was debited to insurance expense and no adjusting entry was recorded for this item.
b. During 2021, the company received a $850 cash advance from a customer for merchandise to be manufactured and shipped in 2022. The $850 was credited to sales revenue. No entry was recorded for the cost of merchandise.
c. There were no supplies listed in the balance sheet under assets. However, you discover that supplies costing $900 were on hand at December 31.
d. Hales borrowed $25,000 from a local bank on October 1, 2021. Principal and interest at 12% will be paid on September 30, 2022. No accrual was recorded for interest.
e. Net income reported in the 2021 income statement is $40,000 before reflecting any of the above items.

Required:
Determine the proper amount of net income for 2021.
Business
1 answer:
Natasha2012 [34]3 years ago
4 0

Answer:

adjusting entries:

a. An insurance policy covering three years was purchased on January 1, 2021, for $6,600. The entire amount was debited to insurance expense and no adjusting entry was recorded for this item.

Dr Prepaid insurance 4,000

    Cr Insurance expense 4,000

b. During 2021, the company received a $850 cash advance from a customer for merchandise to be manufactured and shipped in 2022. The $850 was credited to sales revenue. No entry was recorded for the cost of merchandise.

Dr Sales revenue 850

    Cr Unearned revenue 850

c. There were no supplies listed in the balance sheet under assets. However, you discover that supplies costing $900 were on hand at December 31.

Dr Supplies 900

    Cr Supplies expense 900

d. Hales borrowed $25,000 from a local bank on October 1, 2021. Principal and interest at 12% will be paid on September 30, 2022. No accrual was recorded for interest.

Dr Interest expense 750

    Cr Interest payable 750

e. Net income reported in the 2021 income statement is $40,000 before reflecting any of the above items.

net income after adjustments = $40,000 + $4,000 - $850 + $900 - $750 = $43,300

You might be interested in
a seller places an ad on social media stating that the seller will pay $10,000 to the first licensed real estate broker who find
ser-zykov [4K]

A seller places an ad on social media stating that the seller will pay $10,000 to the first licensed realtor who finds a buyer for the seller's condo that results in a closed sale. This is a type of unilateral contract.

<h3 /><h3>What is a unilateral contract?</h3>

Corresponds to a contract where there is a reward for a certain action, which is performed by only one of the parties involved in the contract, as for example in the statement, where the realtor who is interested in the seller's offer must carry out a closed sale to receive the $10,000 reward.

Therefore, in a unilateral contract, the agreement must be fulfilled after the performance of the contractor's action. If the offer is revoked, it must be duly expressed prior to the practice of the previously determined action. Some examples of the use of unilateral contracts are contests and performances.

Find out more about unilateral contract here:

brainly.com/question/15648341

#SPJ1

7 0
1 year ago
Free enterprise system → A system in which businesses may buy, sell, and set prices with little government control
stiks02 [169]
That is true my friend
5 0
3 years ago
Read 2 more answers
Refer again to the income statements for Cover-to-Cover Company and Biblio Files Company on their respective Income Statement. N
creativ13 [48]

Answer:

$584,000

Explanation:

Calculation to determine what must their amount of sales be

Using this formula

Amount of Sales = (Fixed costs + Target profit) / Contribution margin percentage

Let plug in the formula

Amount of Sales = [42,400+(40,000+63,600) / (106000/424000)

Amount of Sales =(42,400+103,600) / (106,000/424,000)

Amount of Sales=146,000/0.25

Amount of Sales = $584,000

Therefore what The amount of sales will be Cover-to-Cover Company is $584,000

7 0
3 years ago
Omega Company reported the following information for the company's two products: Product X Product Y Selling price per unit $ 35
Elena L [17]

Answer:

Omega Company

B) Product Y should be produced because it will produce greater total profit.

Explanation:

If only Product X is produced, the total profit it will produced is:

Selling price = $35

Variable Cost = $20

Contribution = $15

Total Contribution = $15 x 75,000/4 = $281,250

If only Product Y is produced, the total profit will be:

Selling price = $25

Variable cost = $15

Contribution = $10

Total Contribution = $10 x 75,000/2 = $375,000

Product Y therefore produces a greater total profit.  This is because the fixed cost will remain the same if there are no avoidable elements.

5 0
3 years ago
Read 2 more answers
Assume that one year ago, you bought 130 shares of a mutual fund for $27 per share, you received an income distribution of $0.12
Anika [276]

Answer:

Solution:

Dollar amount of total return = Capital gain distributions + Change in market value

First, we calculate the capital gain distributions

Income and capital gains distribution = ($0.12 + $0.22) x 130 shares

Income and capital gains distribution = $44.2

Now, we calculate the change in market value

Change in market value = Sales Price - Purchase price

Change in market value = 130 x $24 - 130 x $27

Change in market value = -$390

Therefore,

Dollar amount of total return = $44.2 + (-$390)

Dollar amount of total return = -$345.80

6 0
3 years ago
Other questions:
  • Booth's fixed assets were used to only 50% of capacity during 2018, but its current assets were at their proper levels in relati
    8·1 answer
  • Which document allows patients to specify their wishes in regard to four specific dire medical situations by using a 48-item que
    13·1 answer
  • 19.
    9·1 answer
  • Unexpectedly high inflation tends to hurt ________ most
    15·1 answer
  • If 25 consecutive tosses of a fair coin have all been heads, some individuals tend to think that the next one "must be heads." T
    14·1 answer
  • Smart Talk develops a smartphone with a state-of-the-art camera, allowing customers to use their phones as their main photo and
    9·1 answer
  • 13. A relationship cane damaged by trust — honest expectations people spending time with one another
    14·1 answer
  • Suppose the total monetary value of all final goods and services produced in a particular country in 2010 is $500 billion and th
    11·1 answer
  • List a professional example for voicemail
    10·2 answers
  • Which of these social sciences deals most with models of behavior rather than with thought processes?
    6·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!