End-Of-Period Adjustments-Effect on Net Income

question 108

Essay

End-of-period adjustments-effect on net income
Ocean View,Inc.reported revenues of $645,000 and expenses of $360,000 for the month of May,before making any month-end adjusting entries.The following data are provided regarding adjusting entries:
(a. )Portion of insurance expiring in May,$2,520.
(b. )A customer has used the facilities for two weeks in May;the fee of $4,200 has not yet been billed.
(c. )Amount owed for salaries accrued in the last week of May,$1,650.
(d. )Depreciation on equipment for May $1,290.
(e. )Supplies used in May,$13,125.
(f. )Fees collected in advance which have been earned during May,$23,400.
Complete the schedule to determine the net income of Ocean View Inc.for May after these adjustments have been recorded.Begin your schedule with income before adjusting entries and then show the effect of each adjustment to arrive at net income after adjustment.

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