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A company has a fiscal year-end of December 31: (1) on October 1,$27,000...

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Accounting

A company has a fiscal year-end of December 31: (1) on October 1,$27,000 was paid for a one-year fire insurance policy; (2) on June 30 the company loaned its chief financial officer $25,000; principal and interest at 7% on the note are due in one year; and (3) equipment costing $75,000 was purchased at the beginning of the year for cash. Depreciation on the equipment is $15,000 per year.
If the adjusting entries were not recorded, would net income be higher or lower and by how much?
Note: Decreases to account classifications should be entered as a negative.
\table[[Adjusting Entry,Net income],[(1),,],[(2),,],[(3),,],[Total,,]]
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