On December Fawzi Company prepared an income statement and balance sheet and failed to take into account four adjusting
entries. The income statement, prepared on this incorrect basis, reflected pretax income of $ The balance sheet before the
effect of income taxes reflected total assets, $; total liabilities, $; and stockholders' equity, $ The data for the
four adjusting entries follow:
a Wages amounting to $ for the last three days of December were not paid and not recorded the next payroll will be at the
beginning of next year
b Depreciation of $ for the year on equipment that cost $ was not recorded.
c Rent revenue of $ was collected on December of the current year for office space for the period Decer to February
of the next year. The $ was credited in full to Unearned Rent Revenue when collected.
d Income taxes were not recorded. The income tax rate for the company is percent.
Required:
Complete the following tabulation to correct the financial statements for the effects of the four errors. Amounts to be deducted
should be indicated with a minus sign.
How do I find the rent revenue and the income taxes?
