Question
What is the correct answer On December 31, 2017, Waters Company prepared an income statement and balance sheet, but failed to take into account three
What is the correct answer
On December 31, 2017, Waters Company prepared an income statement and balance sheet, but failed to take into account three adjusting entries. The balance sheet showed total assets $150,000, total liabilities $70,000, and stockholders equity $80,000. The incorrect income statement showed net income of $70,000. The data for the three adjusting entries were: 1. Salaries and wages amounting to $10,000 for the last 2 days in December were not paid and not recorded. The next payroll will be in January. 2. Rent payments of $8,000 was received for 2 months in advance on December 1. The entire amount was credited to Unearned Rent Revenue when paid. 3. Depreciation expense for 2017 is $9,000. Complete the following table to correct the financial statement amounts shown (indicate deductions with parentheses). Item Net Income Total Assets Total Liabilities Stockholders Equity Incorrect balances $70,000 $150,000 $70,000 $80,000 Effects of: Salaries and Wages Entry field with correct answer -10000 Entry field with correct answer 0 Entry field with incorrect answer Entry field with incorrect answer 1000 Rent Revenue Entry field with incorrect answer Entry field with correct answer Entry field with incorrect answer -8000 Entry field with incorrect answer 8000 Depreciation Entry field with correct answer -9000 Entry field with correct answer -9000 Entry field with correct answer Entry field with incorrect answer Correct balances $Entry field with incorrect answer -12000 $Entry field with incorrect answer 6000 $Entry field with incorrect answer 62000 $Entry field with incorrect answer now contains modified data 89000
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