Question : 42) Cruits, Inc. prepared the following income statement before adjustments: Cruits, : 1253180

 

42) Cruits, Inc. prepared the following income statement before adjustments:

 

Cruits, Inc.

Income Statement

For the Month Ended September 30, 2011

Sales revenue$30,000

Expenses

Rent              $5,000

Utilities2,000

Salaries8,000

Depreciation3,000

Total expenses$18,000

Net income (loss)$12,000

 

Required:

Determine the net income or loss after adjustment given the following additional information for the month of September:

a. Salaries earned but unrecorded and unpaid equals $1,000.

b. Depreciation for the month should be an additional $2,000.

c. Customer work completed, but not yet billed or collected equals $4,000.

43) Growing Green Care prepared the following income statement before adjustments:

 

Growing Green Care

Income Statement

For the Month Ended September 30, 2011

 

Sales revenue$50,000

Expenses

Rent              $12,000

Utilities3,000

Salaries18,000

Depreciation5,000

Total expenses38,000

Net income (loss)$12,000

 

Required:

Determine the net income or loss after adjustment given the following additional information for the month of September:

a. Salaries earned but unrecorded and unpaid equals $5,000.

b. Depreciation for the month should be an additional $3,000.

c. Customer work completed, but not yet billed or collected equals $5,000.

44) Cal’s Lawn Care prepared the following income statement before adjustments:

 

Cal’s Lawn Care

Income Statement

For the Month Ended September 30, 2011

Revenues

Sales              $80,000

Interest5,000

Total revenues$85,000

Expenses

Salaries18,000

Rent6,000

Supplies200

Depreciation5,000

Total expenses29,200

Net income (loss)$55,800

 

Required:

Determine the profit or loss after adjustment given the following additional information for the month of September:

a. Salaries earned but unrecorded and unpaid equals $8,000.

b. Depreciation for the month should be an additional $2,000.

c. Additional supplies used up equals $100.

d. Unearned revenue earned equals $1,000.

 

45) An inexperienced accountant made the following adjustments to the accounting system of Airata, Inc. The adjustments were made based on the information below the accounting equation worksheet.

 

Assets

Liabilities

Shareholders’ equity

 

 

 

CC

Retained earnings

a.

 

6,000 Cash

 

 

 

 

6,000 Revenue

b.

 

100 Supplies

 

 

 

 

(700) Supplies expense

c.

 

 

 

 

 

 

(10,000) Equipment expense

10,000  Accumulated depreciation

d.

 

(4,800) Cash

 

 

 

 

(4,800) Interest expense

e.

 

(10,000) Cash

 

 

(10,000) Salaries expense

 

 

 

a.Unearned revenue has a December 31 balance of $10,000 before adjustment. Forty percent of the unearned revenue has been earned by the end of the year.

b.Before adjustment, the supplies account equals $800. Only $100 of the supplies remain as of the end of the year.

c.The equipment is depreciated by $10,000 per year.

d.Interest accrues on an $80,000, 12%, 6-month note payable that has been outstanding for the past three months.

e.Salaries earned by employees but not yet paid are $10,000.

 

Required: Cross out any incorrect account titles or dollar amounts in the worksheet shown above. Write in the correct account titles and dollar amounts where needed.

 

 

 

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