Indio Company Prepared the Following Adjusting Entries at Year End $\begin{array}{lrr} \text { Interest Expense} &280\\ \text { Interest Payable} & &280\\\end{array}$

question 83

Essay

Indio Company prepared the following adjusting entries at year end on December 31 2016: (a)
$\begin{array}{lrr} \text { Interest Expense} &280\\ \text { Interest Payable} & &280\\\end{array}$

(b)
$\begin{array}{lrr} \text { Interest Receivable } &540\\ \text { Interest Revenue } &&540\\\end{array}$

(c)
$\begin{array}{lrr} \text { Salaries and Wages Expense } &5,300\\ \text { Salaries and Wages Payable } &&5,300\\\end{array}$
In an effort to minimize errors in recording transactions Indio Company utilizes reversing entries. Prepare reversing entries on January 1 2017.

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Definitions:

Unsecured

Refers to a loan or credit that is not backed by collateral, meaning the lender takes on more risk and relies on the borrower's creditworthiness.

Internal Audits

Evaluations conducted by a company's own staff to assess its systems, controls, and operations for efficiency, effectiveness, and compliance.

Major Investment Decisions

Critical financial choices made by businesses regarding large-scale expenditures on assets or projects expected to generate long-term benefits.

Financial Forecasts

Estimates or predictions about future financial performance, including revenue, expenses, cash flow, and economic conditions impacting a business.