At the end of April, the first month of operations, the following selected data were taken from the financial statements of Shelby Crawford, an attorney:
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Net income for April
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$100,650
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Total assets at April 30
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732,600
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Total liabilities at April 30
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316,650
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Total stockholders' equity at April 30
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415,950
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In preparing the financial statements, adjustments for the following data were overlooked:
a. Supplies used during April, $3,050.
b. Unbilled fees earned at April 30, $24,300.
c. Depreciation of equipment for April, $2,200.
d. Accrued wages at April 30, $1,700.
Required:
1. Journalize the entries on April 30 to record the omitted adjustments. Refer to the Chart of Accounts for exact wording of account titles.
2. Determine the correct amount of net income for April and the total assets, liabilities, and stockholders' equity at April 30. In addition to indicating the corrected amounts, indicate the effect of each omitted adjustment using the columnar table provided. Adjustment (a) is presented as an example. (Note: Use a minus sign (-) to indicate a decrease. If there is no amount or an amount is zero, enter "0".)
Corrected Amounts
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1
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Net Income
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Total Assets =
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Total Liabilities +
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Total Stockholders' Equity
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2
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Reported amounts
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$100,650.00
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$732,600.00
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$316,650.00
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$415,950.00
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3
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Corrections:
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4
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Adjustment (a)
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(3,050.00)
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(3,050.00)
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0.00
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(3,050.00)
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5
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Adjustment (b)
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6
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Adjustment (c)
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7
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Adjustment (d)
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8
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Corrected amounts
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