The Skies Company reported net income of $58,200 for the year ended December 31, 2080. An analysis of the firm's books and related records disclosed that certain adjust- ments were not made at year end; therefore, reported net income was incorrect.Adams Nigel
REQUIRED: Using the method illustrated in Figure 6 of your text, prepare a bal-
ance sheet as of December 31, 2080, on the forms provided at the back of this
unit. Then answer questions 8-10. DO NOT send the work forms to us.
8. The total current liabilities for the Mahoney Corporation
9. In which section of the balance sheet should the accumulated depredation account be
Plant or fixed asset
10. The Sinking Fund Cash account is properly classified as a
A. current asset.
Base your answer to question
on the following Information:
The Skies Company reported net income of $58,200 for the year ended December 31,
2080. An analysis of the firm's books and related records disclosed that certain adjust-
ments were not made at year end; therefore, reported net income was incorrect. The
following errors and omissions were made.
Accrued interest earned on investments amounted to $205, but the amount wasn't
Depreciation of $370 on machinery wasn't recorded.
Rent revenue of $220 was received in advance and credited to the
Semiannual bond payable interest of $1,820 was paid, but the amount wasn't
The unexpired Insurance premium at year end totaled $440. The total Insurance
premium was debited to the Insurance Expense account during the year.
Office supplies expense for the year amounted to $690. The firrn debits an asset
account whenever office supplies are purchased. The entry for supplies used must
be made at year end.
REQUIRED: Prepare a statement for the year ended December 31, 20X0, to
the corrected net Income, taking into account the adjustments listed. Use the
form at the back of this unit. Them answes question 11. DO NOT send your work
form to us.
11. The coirected net Income for the year, after adjustments, would be
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