The completed worksheet for Chavarria Corporation as of December $31,20$X$1,$ after the company had completed the first month of operation, appears below.

CHAVARRIA CORPORATION

Worksheet

Month Ended December $31,20$X$1$

Trial Balance Adjustments Adjusted Trial Balance Income Statement Balance Sheet

Account Name Debit Credit Debit Credit Debit Credit Debit Credit Debit Credit

Cash $76,60076,60076,600$

Accounts receivable $11,40011,40011,400$

Supplies $8,9005,4003,5003,500$

Prepaid advertising $10,8001,8009,0009,000$

Equipment $100,000100,000100,000$

Accumulated depreciation$$Equipment $2,0002,0002,000$

Accounts payable $11,40011,40011,400$

Isabel Chavarria, Capital $107,400107,400107,400$

Isabel Chavarria, Drawing $6,6006,6006,600$

Fees income $112,900112,900112,900$

Supplies expense $5,4005,4005,400$

Advertising expense $1,8001,8001,800$

Depreciation expense$$Equipment $2,0002,0002,000$

Salaries expense $16,20016,20016,200$

Utilities expense $1,2001,2001,200$

Totals $231,700231,7009,2009,200233,700233,70026,600112,900207,100120,800$

Net income $86,30086,300$

$112,900112,900207,100207,100$

Required:

Prepare an income statement.

Prepare a statement of owner$$s equity. The owner made no additional investments during the month.

Prepare a balance sheet.

Analyze:

If the adjustment to Prepaid Advertising had been $$3,600$ instead of $$1,800,$ what net income would have resulted?