At the end of August, the first month of operations, the following selected data were taken from the financial statements of Tucker Jacobs, an attorney: Net income for August Total assets at August 31 Total liabilities at August 31 Total owner's equity at August 31 $112,500 650,000 225,000 425,000 In preparing the financial statements, adjustments for the following data were overlooked: • Unbilled fees earned at August 31, $31,900. Depreciation of equipment for August, $7,500. • Accrued wages at August 31, $5,200. • Supplies used during August, $3,000. Instructions 1. Journalize the entries to record the omitted adjustments. 2. Determine the correct amount of net income for August and the total assets, liabilities, and owner's equity at August 31. In addition to indicating the corrected amounts, in- dicate the effect of each omitted adjustment by setting up and completing a columnar table similar to the following. The first adjustment is presented as an example. Net Total Assets Total Liabilities Total Owner's Income Equity Reported amounts $112,500 $650,000 $225,000 $425,000 Corrections: Unbilled fees earned +31,900 +31,900 +31,900 Equipment depreciation Accrued wages Supplies used Corrected amounts

At the end of August, the first month of operations, the following selected data were taken from the financial statements of Tucker Jacobs, an attorney: Net income for August Total assets at August 31 Total liabilities at August 31 Total owner's equity at August 31 $112,500 650,000 225,000 425,000 In preparing the financial statements, adjustments for the following data were overlooked: • Unbilled fees earned at August 31, $31,900. Depreciation of equipment for August, $7,500. • Accrued wages at August 31, $5,200. • Supplies used during August, $3,000. Instructions 1. Journalize the entries to record the omitted adjustments. 2. Determine the correct amount of net income for August and the total assets, liabilities, and owner's equity at August 31. In addition to indicating the corrected amounts, in- dicate the effect of each omitted adjustment by setting up and completing a columnar table similar to the following. The first adjustment is presented as an example. Net Total Assets Total Liabilities Total Owner's Income Equity Reported amounts $112,500 $650,000 $225,000 $425,000 Corrections: Unbilled fees earned +31,900 +31,900 +31,900 Equipment depreciation Accrued wages Supplies used Corrected amounts

Financial Accounting

15th Edition

ISBN:9781337272124

Author:Carl Warren, James M. Reeve, Jonathan Duchac

Publisher:Carl Warren, James M. Reeve, Jonathan Duchac

Chapter3: The Adjusting Process

Section: Chapter Questions

Problem 6PB: At the end of August, the first month of operations, the following selected data were taken from the...

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