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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

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WARRIOR [948]

Answer:

Debit Unearned Fees, $8,370

Credit Fees Earned, $8,370

Explanation:

Based on the information given we were told that the Company received the amount of $33,480 from Santa Fe for 36 month on April 1 in which we are to assumed that the adjustments will be made at the year end this means that the adjusting entry will be to:

Debit Unearned Fees, $8,370

Credit Fees Earned, $8,370

Calculated as :

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=$8,370

Note that from 1st April to 31st December will give us 9 months.

7 0
3 years ago
When comparing Mexico to Scotland, you would expect Scottish workers to have ________. more satisfaction worse working condition
Fudgin [204]

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Explanation:

One may expect that a Scotland plant will be less labour intensive and efficient per worker than just Mexican facilities as a more advanced technological nation and that "higher productivity and low labour cost" will be the right answer.

Both possibilities for lower productivity can be excluded as they demonstrate lower productivity. "Higher productivity, but less energy per job" is not the solution because it recognises lower labour costs per worker rather than higher.

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5 0
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Flawless Cosmetic Company manufactures and distributes several different products. The company currently uses a plantwide alloca
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Answer:

Option (D) is correct.      

Explanation:

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Total Machine Hours:

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Overhead Rate:

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= 80.00 + 30.00 + 15.90

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4 0
3 years ago
Which of the following refers to a process of developing distribution​ objectives, evaluating internal and external environmenta
german

Answer:

The correct answer is E. Distribution planning.

Explanation:

Distribution planning refers to the development of objectives from production to putting the product on the counter. This process includes the entire chain from when the raw material to produce is entered, and the logistics necessary to transport the product to the final supplier. This process must evaluate external and internal problems in order to make it as expeditious as possible and the times are met in order to avoid product shortages.

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The Federal Open Market Committee can act almost immediately.
8 0
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