9 Brief Exercise 2-12 (Algo) Adjusting entries; income determination [LO2-5, 2-6]A company has a fiscal year-end of December 31: (1) on October 1, $21,000 was paid for a one-year fire insurance policy; (2) on June30 the company loaned its chief financial officer $19,000; principal and interest at 5% on the note are due in one year; and (3)equipment costing $69,000 was purchased at the beginning of the year for cash. Depreciation on the equipment is $13,800 per year.If the adjusting entries were not recorded, would net income be higher or lower and by how much?Note: Decreases to account classifications should be entered as a negative.Adjusting Entry(1)(2)(3)TotalNet incomehigherlower

Adjusting entries are recorded in the books at the end of period in order to make sure that the…

company has a fiscal year-end of December 31: (1) on October 1, $21,000 was paid for a one-year fire insurance policy; (2) on June the company loaned its chief financial officer $19,000; principal and interest at 5% on the note are due in one year; and (3) uipment costing $69,000 was purchased at the beginning of the year for cash. Depreciation on the equipment is $13,800 per year. he adjusting entries were not recorded, would net income be higher or lower and by how much? ote: Decreases to account classifications should be entered as a negative. Adjusting Entry (1) (2) (3) Total Net income higher

company has a fiscal year-end of December 31: (1) on October 1, $21,000 was paid for a one-year fire insurance policy; (2) on June the company loaned its chief financial officer $19,000; principal and interest at 5% on the note are due in one year; and (3) uipment costing $69,000 was purchased at the beginning of the year for cash. Depreciation on the equipment is $13,800 per year. he adjusting entries were not recorded, would net income be higher or lower and by how much? ote: Decreases to account classifications should be entered as a negative. Adjusting Entry (1) (2) (3) Total Net income higher

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter9: Current Liabilities And Contingent Obligations

Section: Chapter Questions

Problem 3RE: Cee Co.s fiscal year begins April 1. At the beginning of its fiscal year, Cee Co. estimates that...

See similar textbooks

Similar questions

Cee Co.s fiscal year begins April 1. At the beginning of its fiscal year, Cee Co. estimates that it will owe 17,400 in property taxes for the year. On June 1, its property taxes are assessed at 17,000, which it pays immediately. Prepare the related journal entries for April 1, May 1, and June 1. Then compute the monthly property tax expense that Cee Co. would record during June through March.
Current Attempt in Progress Swifty Wholesalers Ltd. has a December 31 year end. The company incurred the following transactions related to current liabilities: 1. Swifty's cash register showed the following totals at the end of the day on March 17: pre-tax sales $55,000, GST $2,750, and PST $3,850. 2. 3. Swifty remitted $49,000 of sales taxes owing from March to the government on April 30. Swifty paid its employees for the week of August 15 on August 20. The gross pay was $80,000. The company deducted $4,240 for CPP, $1,264 for El, $6,400 for pension, and $16,020 for income tax from the employees' pay. 4. Swifty recorded the employer portions of CPP and El for the week of August 15 on August 20 for $4,240 and $1,770, respectively. 5. On September 15, all amounts owing for employee income taxes, CPP, and El pertaining to the payroll transactions above were paid. 6. On December 31, Swifty's legal counsel believes that the company will have to pay damages of $62,000 next year to a local…
A company has a fiscal year-end of Dec. 31: (1) On Oct. 1, $12,000 was paid for a one-year fire insurance policy;(2) On June 30 the company advanced its cheif financial officer $10,000; principle and interest at 6% on the note are due in on eyear(3) Equipment costing $60,000 was purchases at the beginning of the year for cash. Depreciation on the equipment is $12,000 per year.If the adjusting entries were not recorded, would net income be higher or lower and by how much?
On June 1, Davis Inc. issued an $89,300, 8%, 120-day note payable to Garcia Company. Assume that the fiscal year of Garcia ends June 30. Using a 360-day year, what is the amount of interest revenue recognized by Garcia in the following year? When required, round your answer to the nearest dollar. a. $1,806 Ob. $7,144 O c. $595 Od. $1,191 B
More info Oct. 1 Nov. 15 Dec. 31 Sold a six-month subscription (starting on November 1), collecting cash of $270, plus sales tax of 5%. Remitted (paid) the sales tax to the state of Tennessee. Made the necessary adjustment at year-end to record the amount of subscription revenue earned during the year. Print Done - X
On June 1, Davis Inc. issued an $84,000, 5%, 120-day note payable to Garcia Company. Assume that the fiscal year of Garcia ends June 30. Using the 360-day year, what is the amount of interest revenue (rounded) recognized by Garcia in the following year? a.$4,200 b.$1,600 c.$700 d.$1,050
On June 8, Alton Co. issued an $77,100, 7%, 120-day note payable to Seller Co. Assume that the fiscal year of Seller Co. ends June 30. Using a 360-day year in your calculations, what is the amount of interest revenue recognized by Seller in the following year? When required, round your answer to the nearest dollar. $450 $1,469 $900 $5,397
On December 1, a company signed a $6,000, 90-day, 5% note payable, with principal plus interest due on March 1 of the following year. What amount of interest expense should be accrued at December 31 on the note? a. $300 c. $100 e. $0 b. $25 d. $75
On August 1, 2018, Avonette, Inc., sold equipment and accepted a six-month, 9%, $50,000 notereceivable. Avonette’s year-end is December 31.Q5-48. How much interest revenue should Avonette accrue on December 31, 2018?a. $4,500b. $2,425c. $1,875d. $2,250
On September 1, Year 1, West Company borrowed $34,000 from Valley Bank. West agreed to pay interest annually at the rate of 9% per year. The note issued by West carried an 18-month term. West Company has a calendar year-end. What is the amount of interest expense that will be reported on West's income statement for Year 1? Multiple Choice O O $-0- $1,020 $306 $765
10.4 Jelly Co has sublet part of its offices and in the year ended 30 November 20X3 the rent receivable was: Until 30 June 20X3 $8,400 per year $12,000 per year From 1 July 20X3 Rent was paid quarterly in advance on 1 January, April, July, and October each year. What amounts should appear in Jelly Co's financial statements for the vear ended 30 November 20X3? Rent receivable Statement of financial position $2,000 in sundry payables $1,000 in sundry payables $1,000 in sundry payables $2,000 in sundry receivables A $9,900 $9,900 B $10,200 $9,900 C
On July 8, Jones Inc. issued an $67,200, 9%, 120-day note payable to Miller Company. Assume that the fiscal year of Jones ends July 31. Using a 360-day year, what is the amount of interest expense recognized by Jones in the current fiscal year? When required, round your answer to the nearest dollar. a. $6,048 b. $1,158 c. $386 d. $772