9. What amount should be reported as adjusted net income for the current year?*

3 points

SHADOW BONE Company reported net income of P7,500,000 for the current year: The auditor raised questions about the following amounts that has been included in net income: Unrealized loss on foreign currency translation 500,000 Gain on early retirement of bonds payable 2,200,000 Debit adjustment of profit of prior year for error in depreciation, net of tax effect 750,000 Loss from fire. 1,400,000ENOLA HOLMES Company provided the following information at year end: Share premium 1,000,000 Accounts payable 1,100,000 Preference share capital, at par 2,000,000 Ordinary share capital, at par 3,000,000 Sales 10,000,000 Total expenses 7,800,000 Treasury shares - ordinary 500,000 Dividends 700,000 Retained earnings - beginning 1,000,000