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Ouring the course of your examination of the financial statements of a company for the...

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Accounting

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Ouring the course of your examination of the financial statements of a company for the year ended December 31, Year 1, you discover net income in Year 1 is $44,000 but no adjusting entries have been prepared. To prepare adjusting entries, you discover the following items: a. An insurance policy covering three years was purchased on January 1, Year 1, for $7,800. The entire amount was debited to insurance expense 002520 b. During Year 1, the company received a $950 cash advance from a customer for services to be provided in Year 2 . The $950 was credited to sales revenue. c. All purchases of supplies were debited immediately to supplies expense. However, you discover that supplies costing $1,040 were on hand on December 31 . d. The company borrowed $29,000 from a local bank on October 1, Year 1. Principal and interest at 12% will be paid on September 30 . Year 2. No accrual was recorded for interest. Required: Determine the proper amount of net income for Year 1. Note: Amounts to be deducted should be indicated by a minus sign. \begin{tabular}{|l|l|l|} \hline Unadjusted net income \\ \hline Adjustments: & \\ \hline a & & \\ \hline b. & & \\ \hline c. & & \\ \hline d. & & \\ \hline Adjusted net income & 5 \\ \hline \end{tabular}

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