On December 31, 2025, Waters Electricians prepared an income statement and statement of financial position, but failed to take into account three adjusting entries. The statement of financial position showed total assets €150,000, total liabilities €70,000, and equity €80,000. The incorrect income statement showed net income of €70,000.

The data for the three adjusting entries were:

1. Salaries and wages amounting to €10,000 for the last 2 days in December were not paid and not recorded. The next payroll will be in January.

2. Rent payments of €8,000 were received for two months in advance on December 1. The entire amount was credited to Unearned Rent Revenue when paid.

3. Depreciation expense for 2025 is €9,000.

Instructions Complete the following table to correct the financial statement amounts shown (indicate deductions with parentheses).

Transcribed Image Text:

Item Net Income Total Assets Total Liabilities Equity Incorrect balances 70,000 150,000 70,000 80,000 Effects of: Salaries and Wages Rent Revenue Depreciation Correct balances ||||