The Blue Chip Co. prepared the following income statement for December 31, 2008 but neglected to make the necessary adjusting entries. Revenues Expenses Wage Expense Rent Expense The Blue Chip Co. Income Statement For the Year ending December 31, 2019 Telephone Expense Utility Expense Total Expenses Profit Revenues $16,480 4,320 560 960 $96.400 Required: Prepare a corrected income statement after considering the following: (1.) The company had purchased a truck for $4,800 on January 1, 2019 which was expected to last 5 years. It was originally debited to the account "Truck" and credited to cash. (2.) Salaries of $2,400 were owed to employees but not yet recorded. (3.) The company owed $640 in accrued interest which was to be paid early in January, 2020. (4.) In November, 2019 the company had received $3,600 of advance payments which were originally recorded as Unearned Revenue. One-third of this was earned in December, 2019. The Blue Chip Co. Income Statement For the Year ending December 31, 2019 22.320 74,080 $97,600

The Blue Chip Co. prepared the following income statement for December 31, 2008 but neglected to make the necessary adjusting entries. Revenues Expenses Wage Expense Rent Expense The Blue Chip Co. Income Statement For the Year ending December 31, 2019 Telephone Expense Utility Expense Total Expenses Profit Revenues $16,480 4,320 560 960 $96.400 Required: Prepare a corrected income statement after considering the following: (1.) The company had purchased a truck for $4,800 on January 1, 2019 which was expected to last 5 years. It was originally debited to the account "Truck" and credited to cash. (2.) Salaries of $2,400 were owed to employees but not yet recorded. (3.) The company owed $640 in accrued interest which was to be paid early in January, 2020. (4.) In November, 2019 the company had received $3,600 of advance payments which were originally recorded as Unearned Revenue. One-third of this was earned in December, 2019. The Blue Chip Co. Income Statement For the Year ending December 31, 2019 22.320 74,080 $97,600

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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