is the company's fiscal year$-$end. Information necessary to prepare the year$-$end adjustments appears below.

A three$-$year fire insurance policy was purchased on July $1,2024,$ for $$18,000.$ The company recorded the amount in Prepaid Insurance on July $1.$ The cost of insurance prior to July totals $$2,500.$

Employee salaries of $$25,000$ for the month of December will be paid in early January. Salaries paid in the first $11$ months of the year totaled $$190,000.$

On November $1,2024,$ the company received $$6,000$ in cash from a customer requesting a custom design for six identical bikes $($ $$1,000$ each$).$ The entire amount is recorded in Deferred Revenue on November $1.$ By the end of the year, four of the bikes have been completed. Other revenues generated during the year total $$280,000.$

Supplies at the beginning of the year totaled $$2,000.$ During $2024,$ additional supplies of $$18,000$ were purchased and recorded in Supplies at the time of purchase. Supplies remaining at the end of the year total $$4,000.$

Buzzard paid a local radio station $$12,000$ for four months of advertising on December $1,2024.$ The advertising will appear evenly over the four$-$month period. The company recorded the entire amount in Prepaid Advertising on December $1.$ Advertising costs the first $11$ months of the year total $$15,000.$

Buzzard borrowed $$36,000$ on March $1,2024.$ The principal is due to be paid in five years. Interest is payable each March $1$ at an annual rate of $10\%.$

Required:

Determine the adjustments needed on December $31,2024.$

Prepare an income statement for Buzzard Bicycle for the year ended December $31,2024.$

Note: Amounts to be deducted should be indicated with a minus sign.

Complete this question by entering your answers in the tabs below.

Determine the adjustments needed on December $31,2024.$

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