Below are the restated amounts of net income and retained earnings for Volunteers Incorporated and Raiders...
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Below are the restated amounts of net income and retained earnings for Volunteers Incorporated and Raiders Incorporated for the period 2015 to 2024. Volunteers began operations in 2016, while Raiders began several years earlier. Required: Calculate the balance of retained earnings each year for each company. Neither company paid dividends during this time. (Enter your answers in millions (i.e., 10,000,000 should be entered as 10). Amounts to be deducted should be indicated by a minus sign.) VOLUNTEERS INCORPORATED RAIDERS INCORPORATED ($ in millions) (S in millions) Year Net Income (Loss) Retained Earnings Net Income (Loss) Retained Earnings 2015 $ 0 $ 0 $ 29 $ 2016 24 (49) 2017 (7) 55 2018 35 57 2019 129 96 2020 24 129 2021 (137) (48) 2022 571 68 2023 353 104 2024 354 156 11 During the course of your examination of the financial statements of Trojan Corporation for the year ended December 31, 2024, you come across several items needing further consideration. Currently, net income is $87,000. 1. An insurance policy covering 12 months was purchased on October 1, 2024, for $16,200. The entire amount was debited to Prepaid Insurance and no adjusting entry was made for this item in 2024. 2. During 2024, the company received a $2,700 cash advance from a customer for services to be performed in 2025. The $2,700 was incorrectly credited to Service Revenue. 3. Purchases of supplies during the year were incorrectly recorded to Supplies Expense. You discover that supplies costing $2,100 were on hand at December 31, 2024. 4. Trojan borrowed $57,000 from a local bank on September 1, 2024. Principal and interest at 9% will be paid on August 31, 2025. No accrual was made for interest in 2024. Required: Using the information in 1 through 4 above, determine the proper amount of net income as of December 31, 2024. (Do not round intermediate calculations. Amounts to be deducted should be indicated with a minus sign.) Net income (unadjusted) $ 87,000 1. Adjustment for insurance 2. Adjustment for deferred revenue 3. Adjustment for supplies 4. Adjustment for interest Net income (adjusted) $ 87,000 Below are the restated amounts of net income and retained earnings for Volunteers Incorporated and Raiders Incorporated for the period 2015 to 2024. Volunteers began operations in 2016, while Raiders began several years earlier. Required: Calculate the balance of retained earnings each year for each company. Neither company paid dividends during this time. (Enter your answers in millions (i.e., 10,000,000 should be entered as 10). Amounts to be deducted should be indicated by a minus sign.) VOLUNTEERS INCORPORATED RAIDERS INCORPORATED ($ in millions) (S in millions) Year Net Income (Loss) Retained Earnings Net Income (Loss) Retained Earnings 2015 $ 0 $ 0 $ 29 $ 2016 24 (49) 2017 (7) 55 2018 35 57 2019 129 96 2020 24 129 2021 (137) (48) 2022 571 68 2023 353 104 2024 354 156 11 During the course of your examination of the financial statements of Trojan Corporation for the year ended December 31, 2024, you come across several items needing further consideration. Currently, net income is $87,000. 1. An insurance policy covering 12 months was purchased on October 1, 2024, for $16,200. The entire amount was debited to Prepaid Insurance and no adjusting entry was made for this item in 2024. 2. During 2024, the company received a $2,700 cash advance from a customer for services to be performed in 2025. The $2,700 was incorrectly credited to Service Revenue. 3. Purchases of supplies during the year were incorrectly recorded to Supplies Expense. You discover that supplies costing $2,100 were on hand at December 31, 2024. 4. Trojan borrowed $57,000 from a local bank on September 1, 2024. Principal and interest at 9% will be paid on August 31, 2025. No accrual was made for interest in 2024. Required: Using the information in 1 through 4 above, determine the proper amount of net income as of December 31, 2024. (Do not round intermediate calculations. Amounts to be deducted should be indicated with a minus sign.) Net income (unadjusted) $ 87,000 1. Adjustment for insurance 2. Adjustment for deferred revenue 3. Adjustment for supplies 4. Adjustment for interest Net income (adjusted) $ 87,000
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Related Book For
Financial Accounting
ISBN: 9780078110825
2nd Edition
Authors: J. David Spiceland, Wayne Thomas, Don Herrmann
Posted Date:
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