Obtain the annual report of a real company of your choosing. Assume that the company accountants failed to make four adjustments at the end of the current year. For illustrative purposes, we shall assume that the amounts reported in the company's balance sheet for the related assets and liabilities are incorrect.

Adjustments omitted:

a. Depreciation of equipment, \(\$ 800,000\)

b. Salaries owed to employees but not yet paid, \(\$ 230,000\)

c. Prepaid rent used up during the year, \(\$ 100,000\)

d. Accrued sales (or service) revenue, \(\$ 140,000\)

\section*{Required}

1. Compute the correct amounts for the following balance sheet items:

a. Book value of plant assets

b. Total liabilities

c. Prepaid expenses

d. Accounts receivable 2. Compute the amount of net income or net loss that the company would have reported if the accountants had recorded these transactions properly. Ignore income tax.