Problem related to prepaid insurance

Assignment Help Accounting Basics
Reference no: EM13259274

On December 31, 2007, the Rift Music Store reported net incomeof 1,200 and the following account balances.

Cash 1,425

Accounts Receivable 2,300

Prepaid Insurance 1,200

Equipment and furnishings 3,200

Less: Accumulated depreciation (500)

Accounts Payable 1,300

Wages Payable 1,520

Owners equity (includes Net income of 1,200) 4,805

After the information was prepared, the bookkeeper discoveredthat he had forgotten to make two necessary adjusting entries forthe year and, therefore, they were not reflected in the balancesshown. Information concerning the two missing adjustingentries follows:

A. The prepaid insurance involves a 3-year fire insurancepolicy that was purchased (and went into effect) on January 1,2007. By the end of the year, apportion of the insurance policy had been used up.

B. The wages payable does not include the wages that wereowned at year-end to two workers who had been temporarily assignedto work off the premises. This amount totaled $375.

Use the following schedule; determine the correct year-endamount of (1) total assets, (2) total liabilities, (3) ownersequity, and (4) net income.

Reference no: EM13259274

Thomas plastics is in the process of developing

Write a one-to two-page report to Sally Rogers explaining the generally accepted accounting principles relevant to this issue. The report should also address the treatment of

Distributive share and guaranteed payment

In the current year, the partnership reports $400,000 in ordinary income. What are Yees distributive share and her guaranteed payment?

Implications of the changes in the aging schedule

Determine the total estimated uncollectibles. Prepare the adjusting entry at March 31, 2007, to record bad debts expense. Discuss the implications of the changes in the aging

Ending baldwins balance in common stock be next year

Suppose next year the Baldwin Company generates $44,200 in net profit, pays $12,000 in dividends, total assets increase by $55,000, and total liabilities remain unchanged. Wha

What proportion drinks no more than

If the top 5% of coffee drinkers are considered heavy coffee drinkers, what is the minimum number of cups consumed by a heavy coffee drinker? Hint: Find the 95th percentile.

What is needles basis in the machinery

Nora transfers to Needle Corp depreciable machinery originally costing $18,000 and now having a $15,000 adjusted basis. In exchange, Nora receives all 100 shares of Needle s

Performance reporting-flexible budgeting

Analyze the budget variance by calculating the direct labor efficiency and rate variances for June. What alternatives to the preceding monthly report could improve control ove

Financial statement fraud schemes

You are the investigator assigned to Apollo Shoes. Based on the nature of the company and the evidence provided to you, you must determine which financial statement fraud sc


Write a Review

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd