JB Company has a net income of 100000 for the year before ad

JB Company has a net income of 100,000 for the year before adjusting entries, If the following adjustments are necessary what amount will JB report for net income?

- office supplies used, $1,000

- Service performed for client but not recorded, $2,000

- Interest accrued on a note payable $7,000

- Insurance expired, $3,000

- two thirds of a $6,000 cash advance for future services was earned during the year.

Solution

Unadjusted Net income 100000 Adjustment office supplies used -1000 Service revenue not recorded 2000 Interest payable not recorded -7000 Insurance expired -3000 Unearned revenue earned 4000 Adjusted Net income 95000