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26 October, 16:16

REM Consulting is completing the accounting information processing at the end of the fiscal year, December 31. The following trial balances are available. Accounts Unadjusted Trial Balance Adjusted Trial Balance Debit Credit Debit Credit Cash 13,000 13,000 Accounts Receivable 1,500 1,800 Prepaid Insurance 600 200 Supplies 3,800 3,000 Machines 30,000 30,000 Accumulated Depreciation 12,000 17,500 Wages Payable 900 Unearned Fees 6,700 6,500 Owner's Capital 24,000 24,000 Owner's Drawing 4,800 4,800 Fees Earned 25,000 25,500 Wages Expense 14,000 14,900 Depreciation Expense 5,500 Supplies Expense 800 Insurance Expense 400 67,700 67,700 74,400 74,400 Required: a. Reconstruct the adjusting entries. Refer to the Chart of Accounts for exact wording of account titles. b. What is the amount of net income?

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  1. 26 October, 16:54
    0
    Net Income 3900

    Explanation:

    REM Consulting

    Un adjusted Trial Balance Adjusted Trial Balance

    Debit Credit Debit Credit

    Cash 13,000 13,000

    Accounts Receivable 1,500 1,800

    Prepaid Insurance 600 200

    Supplies 3,800 3,000

    Machines 30,000 30,000

    Acc. Depreciation 12,000 17,500

    Wages Payable 900

    Unearned Fees 6,700 6,500

    Owner's Capital 24,000 24,000

    Owner's Drawing 4,800 4,800

    Fees Earned 25,000 25,500

    Wages Expense 14,000 14,900

    Depreciation Expense 5,500

    Supplies Expense 800

    Insurance Expense 400

    Total 67,700 67,700 74,400 74,400

    Adjusting Entries

    SR. No Accounts Debit Credit

    1) Accounts Receivable 300

    Sales 300

    As Sales increase so do the Accounts receivable.

    2) Insurance Expense 400

    Prepaid Insurance 400

    Insurance expired by $400.

    3) Supplies Expense 800

    Supplies 800

    Supplies used up by amount $800.

    4) Depreciation Expense 5,500

    Accumulated Depreciation 5,500

    Depreciation Expense amounts to $ 5,500

    5) Fees Earned 200

    Unearned Fees 200

    Provided Services for which payment had been collected,

    6) Cash 500

    Fees Earned 500

    Received $500 for services provided.

    7) Wages Payable 900

    Cash 900

    Paid wages payable to the employee.

    REM Consulting

    Net income

    Fees Earned 25500

    Wages Expense 14,900

    Depreciation Expense 5,500

    Supplies Expense 800

    Insurance Expense 400

    Net Income 3900
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