Calculate Net Income Before Taxes and then record income taxes as 35% of this number (use the multiple step income statement). Note: The taxes will be paid in March 2026. Sinfully Sweet DessertsStartmg value Unadjusted Trial BalanceDecember 31, 2025AccountsDebitCreditCashAccounts ReceivableAllowance for Bad Debts105,80014,6001,900InventoryPrepaid AdvertisingSuppliesAccounts PayableUnearned Revenue10,0001,2004,20014,20012,0007,00072,90028,80074,200Long-Term Note PayableCommon StockRetained EarningsSales RevenueCost of Goods SoldWages ExpenseUtility ExpenseAdvertising Expense40,20010,7003,40020,900211,000Totals211,000Adjusting & Other Entries:

Net income before tax = Total sales - Total expenses except taxes

Startmg Value Sinfully Sweet Desserts Unadjusted Trial Balance December 31, 2025 Accounts Debit Credit Cash 105,800 14,600 Accounts Receivable Allowance for Bad Debts Inventory Prepaid Advertising Supplies Accounts Payable Unearned Revenue 1,900 10,000 1,200 4,200 14,200 12,000 7,000 72,900 28,800 74,200 Long-Term Note Payable Common Stock Retained Earnings Sales Revenue Cost of Goods Sold Wages Expense Utility Expense Advertising Expense Totals 40,200 10,700 3,400 20,900 211.000

Startmg Value Sinfully Sweet Desserts Unadjusted Trial Balance December 31, 2025 Accounts Debit Credit Cash 105,800 14,600 Accounts Receivable Allowance for Bad Debts Inventory Prepaid Advertising Supplies Accounts Payable Unearned Revenue 1,900 10,000 1,200 4,200 14,200 12,000 7,000 72,900 28,800 74,200 Long-Term Note Payable Common Stock Retained Earnings Sales Revenue Cost of Goods Sold Wages Expense Utility Expense Advertising Expense Totals 40,200 10,700 3,400 20,900 211.000

Business/Professional Ethics Directors/Executives/Acct

8th Edition

ISBN:9781337485913

Author:BROOKS

Publisher:BROOKS

Chapter8: Subprime Lending Fiasco-ethics Issues

Section: Chapter Questions

Problem 3.7EC

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