Solution-Prepare income statement and record the adjustment

Prepare income statement and record the adjustment to income

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Reference no: EM132604143

Sawyer Corporation, a private company reporting under ASPE has the following information available with respect to the company's operations until December 31, 2021:

1. Collected $345,000 cash for service revenue earned.

2. Paid $125,000 salaries expense, $56,000 rent expense, and $5,000 insurance expense.

3. Purchased a new vehicle for $35,000 cash on January 1, 2021. This vehicle will be depreciated over 5 years with no salvage value.

4. Accrued $16,000 for income taxes during 2021.

5. On December 31. 2021 the following adjustments were completed: Service revenue earned but not yet collected in cash $22,500

Accrued Interest expense $4,500

Accrued Salaries expense $7,200

Mayer has a 20% income tax rate.

Instructions

Question 1: Prepare income statement and record the adjustment to income taxes.

Reference no: EM132604143

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Prepare income statement and record the adjustment to income

Reference no: EM132604143

Reference no: EM132604143

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