Question

Account Nanes Debit Credit Further Information As reported on December 31 bank statement. Based on count, only $1,000 of supplies stil1 exist. This amount was paid November 1 for rent through the ehd of January. This represents the supplies and utilities through December 15. Val estimates that the company has received $390 of utility services through December 31 for which it has not yet been billed. Stylists have not yet been paid $200 for their work on December 31. Cash $ 3,200 3,700 4,200 Supplies Prepaid Rent Accounts Payable S1,200 total amount of bills received for Salaries and Wages Payable Income Tax Payable C The company has paid last year's income taxes but not this year's taxes. Common Stock This amount was contributed for common stock in prior 1,400 years. This is the balance reported at the end of last year. Customers pay cash vhen they receive services. Retained Earnings Service Revenue Salaries and Wages Вxpense Utilities Expense Rent Expense Supplies Expense Income Tax Expense 800 66,000 28,500 This is the cost of stylint wages through December 30. This is the cost of utilities through December 15. This year's rent vas $1,400 per month. This is the cost of supplies used through November 30. The company has an average tax rate of 30N 11,600 14,000 4,200 C Totals $69,400 $69,400 4-a. Prepare the adjusted net income that the company should report for the year ended December 31, 2018. 4-b. By what dollar amount did the adjustments in requirement (3) cause net income to increase or decrease? Prepare the adjusted net income that the company should report for the year ended December 31, 2018. VAL'S HAIR EMPORIUM Income Statement For the Year Ended December 31, 2018 Revenues Service Revenue $ 66,000 66,000 Total Revenues Expenses 28,700 Salaries and Wages Expense Rent Expense ,800 Utilities Expense 11,990 Supplies Expense 6,900 Income Tax Expense 483 Total Expenses 64,873 Net Income $ 1,127 report for the year ended December 31, 2018. 4-b. By what dollar amount did the adjustments in requirement (3) cause net income to increase or decrease? Complete this question by entering your answers in the tabs below. Req 4A Req 4B By what dollar amount did the adjustments in requirement (3) cause net income to increase or decrease? .... aEERSEERaEERREEREERE ERSTEesTEEEE Net income decreased by $ 1,127 Req 4A Reg 48

Answer 1

Ques 4 Hairstyling revenue 66,000 less: Wages Expense Utilities Expense Rent Expense Supplies Expense 28,700 11,990 16,800 6,900 Income tax expense 483 total expenses 64,873 net income 1,127 Ques 5 Unadjusted income Adjusted income Difference due to adjustments 7,700 1,127 6,573 decrease by 1,127

Ques 1 Hairstyling revenue 66,000 less: Wages Expense Utilities Expense Rent Expense Supplies Expense total expenses 28,500 11,600 14,000 4,200 58,300 net income 7,700 Ques 2 Balance sheet account Related income statement account Supplies Prepaid rent Accounts payable Wages payable Supplies expense Rent expense Utilities expense Wages expense Income tax expense Income taxes payable Ques 3 General Journal Debit Credit Supplies expense Supplies 3700-1000 2,700 a 2,700 Rent expense b. 2,800 Prepaid rent 2,800 4200/3*2 Utilities expense 390 C. Accounts payable 390 Wages expense Wages payable 200 200 Income tax expense 483 2. Income tax payable 483 Note to calculate income tax expense Hairstyling revenue 66.000 less Wages Expense Utilities Expense Rent Expense 28,700 28500+200 11,990 11600+390 16,800 14000+2800 Supplies Expense total expenses 6,900 4200+2700 64,390 net income 1.610 1610*0.3 income tax expense- 483