Exercise 2-17 Accrual accounting income determination [LO2-4, 2-8) During the course of your examination of the financial statements of the Hales Corporation for the year ended December 31, 2018, you discover the following: a. An insurance policy covering three years was purchased on January 1, 2018, for $6,000. The entire amount was debited to b. During 2018, the company received a $1,000 cash advance from a customer for merchandise to be manufactured and shipped in c. There were no supplies listed in the balance sheet under assets. However, you discover that supplies costing $750 were on hand d. Hales borrowed $20,000 from a local bank on October 1, 2018, Principal and interest at 12% wi" be paid on September 30, 2019, No e. Net income reported in the 2018 income statement is $30,000 before reflecting any of the above items insurance expense and no adjusting entry was recorded for this item. 2019. The $1,000 was credited to sales revenue. No entry was recorded for the cost of merchandise. at December 31. accrual was recorded for interest. Required: Determine the proper amount of net income for 2018. (Amounts to be deducted should be indicated by a minus sign.) Unadjusted net income Adjustments: b. C. d. Adjusted net income