Three programmers at Feenix Computer Storage, Incorporated, write an operating systems control manual for Hill-McGraw Publishing, Incorporated, for which Feenix receives royalties equal to 12% of net sales. Royalties are payable annually on February 1 for sales the previous year. The editor indicated to Feenix on December 31, 2024, that book sales subject to royalties for the year just ended are expected to be $280,000. Accordingly, Feenix accrued royalty revenue of $33,600 at December 31 and received royalties of $34,080 on February 1, 2025.

What adjustments, if any, should be made to retained earnings or to the 2024 financial statements?

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