Question $4$:

Brighton Park adjusts its books each month and closes its books on December $31$

each year. The trial balance at January $31,2005,$ before adjustments, follows:

$1$ Refer to the above data. According to attendance records, $$8,200$ of the Unearned

Admission Revenue has been earned in January. Compute the amount of admissions

revenue to be shown in the January income statement:

a $$35,800.$

b $$19,400.$

c $$8,200.$

d $$3,800.$

$2$ Refer to the above data. At January $31,$ the amount of supplies on hand is $$2,300.$

What amount is shown on the January income statement for supplies expense?

a $$2,300.$

b $$5,400.$

c $$3,100.$

d $$7,700.$

$3$ Refer to the above data. The equipment has an original estimated useful life of six

years. Compute the book value of the equipment at January $31$ after the proper

January adjustment is recorded:

a $$1,000.$

b $$71,000.$

c $$53,000.$

d $$60,000.$

$4$ Refer to the above data. Employees are owed $$1,200$ for services since the last payday

in January to be paid the first week of February. No adjustment was made for this item.

As a result of this error:

a Assets at January $31$ are overstated.

b January net income is overstated.

c Liabilities at January $31$ are overstated.

d Owners' equity at January $31$ is understated.

$5$ Refer to the above data. On August $1,2004,$ the park purchased a $12-$month insurance

policy. The necessary adjusting entry at January $31$ includes which of the following

entries? $($Hint: The company has adjusted its books monthly.$)$

a A debit to Insurance Expense for $$1,050.$

b A credit to Unexpired Insurance for $$11,550.$

c A credit to Unexpired Insurance for $$1,800.$

d A debit to Unexpired Insurance for $$10,800.$