Figure APC-2 is the condensed worksheet for the Christopher Company as of December 31, 2014.Additional Information:
a.Prepaid Insurance is for a two-year fire insurance policy dated July 1, 2014.b.The ending inventory amounts to $76.c.The building is being depreciated over a ten-year life, straight-line, no salvage value.d.The balance in Unearned Repair Service Revenue pertains to a contract sold on November 1, 2014, to provide service to a client for one year.e.Office supplies on hand at year-end amount to $14.f.At year-end, there are accrued salaries of $6.g.Consulting Revenue includes a contract for $60 received on October 1, 2014, for a one-year period of time.h.The tax rate is 50%.Required:Complete the worksheet, assuming that adjusting entries are made only at December 31.
What will be an ideal response?
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Calculations:
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| (a) $20/2 × 6/12 = $5 insurance expense |
| (b) ending inventory |
| (c) $200/10 = $20 depreciation expense |
| (d) $12 × 2/12 = $2 earned revenue |
| (e) office supplies expense |
| (f) accrued salaries |
| (g) $60/12 × 9 = $45 unearned revenue |
| (h) $2,033 - $2,027 = $6 pretax income; $6 × 50% = $3 income tax expense |
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