A company has a fiscal year-end of December 31: (1) on October 1, $16,000 was paid for
Fantastic news! We've Found the answer you've been seeking!
Question:
A company has a fiscal year-end of December 31:
(1) on October 1, $16,000 was paid for a one-year fire insurance policy;
(2) on June 30 the company advanced its chief financial officer $14,000; principal and interest at 8% on the note are due in one year;
(3) equipment costing $64,000 was purchased at the beginning of the year for cash.
Depreciation on the equipment is $12,800 per year. If the adjusting entries were not recorded, would net income be higher or lower and by how much?
Related Book For
Intermediate Accounting
ISBN: 978-0324312140
16th Edition
Authors: James D. Stice, Earl K. Stice, Fred Skousen
Posted Date: