Dakota Electric Company uses the calendar year as its annual reporting period. The controller for Dakota has

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Question:

Dakota Electric Company uses the calendar year as its annual reporting period. The controller for Dakota has provided you with the following information:

(i) Employees work Monday through Friday and get paid holidays. The company's weekly payroll is$7,500 and is paid each Friday. Assume that December 31st falls on a Wednesday.

(ii) During late June the company paid $1,800 for a 12 month insurance policy. The policy payment was originally recorded to an asset account and has an effective date of 7/1st.

(iii) On Wednesday, December 31st the company completed $7,000 of customer services. Bills were mailed on Friday, January 2nd and the customers paid shortly thereafter.

(iv) On Friday, January 2nd two bills were paid, specifically the December utility bill totaling $400 and the January health insurance premium totaling $2,500.

Before considering the above items, Dakota reported $65,000 of unadjusted net income. Please assume that Dakota records adjusting entries once per year in December and that no adjusting entries have been booked for the above items.

Determine the necessary adjusting entries and calculate Dakota's adjustment income.