$4-19($Algo$)$ Reporting a Correct Income Statement with Earnings per Share to Include the Effects of Adjusting Entries and Evaluating Total Asset Turnover as an Auditor LO$4-1,4-2,4-3$

Jay, Incorporated, a party rental business, completed its third year of operations on December $31.$ Because this is the end of the annual accounting period, the company bookkeeper prepared the following tentative income statement:

Income Statement

Rent revenue $$106,000$

Expenses:

Salaries and wages expense $26,300$

Maintenance expense $10,300$

Rent expense $7,000$

Utilities expense $4,200$

Gas and oil expense $3,600$

Miscellaneous expenses $($items not listed elsewhere$)1,700$

Total expenses $53,100$

Income $$52,900$

You are an independent CPA hired by the company to audit the company's accounting systems and review the financial statements. In your audit, you developed additional data as follows:

Salaries and wages for the last three days of December amounting to $$750$ were not recorded or paid.

Jay estimated telephone usage at $$310$ for December, but nothing has been recorded or paid.

Depreciation on rental autos, amounting to $$22,100$ for the current year, was not recorded.

Interest on a $$11,000,$ one$-$year, $8$ percent note payable dated October $1$ of the current year was not recorded. The $8$ percent interest is payable on the maturity date of the note.

Maintenance expense excludes $$2,400,$ representing the cost of maintenance supplies used during the current year.

The Unearned Rent Revenue account includes $$6,000$ of revenue to be earned in January of next year.

The income tax expense is $$4,000.$ Payment of income tax will be made next year.

Required:

What adjusting entry for each item $($a$)$ through $($g$)$ should Jay record at December $31?$

Prepare a corrected income statement for the current year including earnings per share. Assume that $6,700$ shares of stock are outstanding all year.

Compute the total asset turnover ratio based on the corrected information. Assume the beginning$-$of$-$the$-$year balance for Jay's total assets was $$59,620$ and its ending balance for total assets was $$66,780.$