Prepare corrected income statement

Assignment Help Accounting Basics
Reference no: EM132923221

Question - Green Day Insurance Agency prepares monthly financial statements. Presented below is an income statement for the month of June that is correct on the basis of information considered.

GREEN Day INSURANCE AGENCY Income Statement For the Month Ended June 30

Revenues

Service Revenue $50,000

Expenses

Salaries and Wages Expense $12,000

Advertising Expense 800

Rent Expense 4,200

Depreciation Expense 2,800

Total Expenses 19,800

Net Income $30,200

Additional Data: When the income statement was prepared, the company accountant neglected to take into consideration the following information:

1. A utility bill for $1,000 was received on the last day of the month for electric and gas service for the month of June.

2. A company insurance salesperson sold a life insurance policy to a client for a premium of $10,000. The agency billed the client for the policy and is entitled to a commission of 20%.

3. Supplies on hand at the beginning of the month were $2,000. The agency purchased additional supplies during the month for $1,500 in cash and $1,000 of supplies were on hand at June 30.

4. The agency purchased a new car at the beginning of the month for $48,000 cash. The car will depreciate $6,000 per year.

5. Salaries owed to employees at the end of the month total $4,000. The salaries will be paid on July 5.

Required - Prepare corrected income statement.

Reference no: EM132923221

Questions Cloud

Explain how nursing advocacy would be beneficial : Discuss why these populations are unable to advocate for themselves, the ethical issues that must be considered when working with these groups.
Primary purchasing and supply chain management skills : What are some of the primary purchasing and supply chain management skills that project managers will need to be successful in the future?
Compute the approximate yield to maturity : The bond carries an annual interest payment of $105 and is currently selling for $880 per bond. Compute the approximate yield to maturity
What type of communication should harmony use : Discuss treatment options for Mrs. Rainwater. What type of communication should Harmony use for this family with multiple problems? Discuss.
Prepare corrected income statement : Salaries owed to employees at the end of the month total $4,000. The salaries will be paid on July 5. Prepare corrected income statement
How should the nurse address these concepts to ensure health : How should the nurse address these concepts to ensure health promotion activities are culturally competent? Provide an example.
Ethical challenges faced by organizations operating globally : Describe the ethical challenges faced by organizations operating globally.
Record all transactions related to these bonds : At the maturity date, 60% of the owners choose to convert the instruments (at the bond-to-share rate of 3:1). Record all transactions related to these bonds
How should the nurse address concepts to ensure health : How should the nurse address these concepts to ensure health promotion activities are culturally competent? Propose strategies that you can employ.

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd