Following are two income statements for Alexis Co. for the year ended December 31.

Following are two income statements for Alexis Co. for the year ended December 31. The left number column is prepared before any adjusting entries are recorded, and the right column includes the effects of adjusting entries. The company records cash receipts and payments related to unearned and prepaid items in balance sheet accounts. The middle column shows a blank space for each income statement effect of the eight adjusting entries a through g (the balance sheet part of the entries is not shown here).

ALEXIS CO. Income Statements For Year Ended December 31
	Unadjusted				Adjustments				Adjusted
Revenues
Fees earned	$	24,000				a.			$	30,000
Commissions earned		42,500								42,500
Total revenues	$	66,500								72,500
Expenses
Depreciation expense—Computers		0				b.				1,500
Depreciation expense—Office furniture		0				c.				1,750
Salaries expense		12,500				d.				14,950
Insurance expense		0				e.				1,300
Rent expense		4,500								4,500
Office supplies expense		0				f.				480
Advertising expense		3,000								3,000
Utilities expense		1,250				g.				1,320
Total expenses		21,250								28,800
Net income	$	45,250							$	43,700

Analyze the statements and prepare the eight adjusting entries a through g that likely were recorded. Note: Answer for a has two entries 30% of (i) the $6,000 adjustment for Fees Earned has been earned but not billed, and (ii) the other 70% has been earned by performing services that were paid for in advance.

  

No	Transaction	General Journal	Debit	Credit
1	a1.	Accounts receivableselected answer correct	1,800selected answer correct	not attempted
		Fees earnedselected answer correct	not attempted	1,800selected answer correct
2	a2.	Unearned feesselected answer correct	4,200selected answer correct	not attempted
		Fees earnedselected answer correct	not attempted	4,200selected answer correct
3	b.	Depreciation expense—Computersselected answer correct	1,500selected answer correct	not attempted
		Accumulated depreciation—Computersselected answer correct	not attempted	1,500selected answer correct
4	c.	Depreciation expense—Office furnitureselected answer correct	1,750selected answer correct	not attempted
		Accumulated depreciation—Office furnitureselected answer correct	not attempted	1,750selected answer correct
5	d.	Salaries expenseselected answer correct	2,450selected answer correct	not attempted
		Salaries payableselected answer correct	not attempted	2,450selected answer correct
6	e.	Insurance expenseselected answer correct	1,300selected answer correct	not attempted
		Prepaid insuranceselected answer correct	not attempted	1,300selected answer correct
7	f.	Office supplies expenseselected answer correct	480selected answer correct	not attempted
		Office suppliesselected answer correct	not attempted	480selected answer correct
8	g.	Utilities expenseselected answer correct	70selected answer correct	not attempted
		Utilities payableselected answer correct	not attempted	70selected answer correct

a1=6000*30%
a2=6000*70%

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