E3-10 Prepare correct income statement

The income statement of Montee Co. for the month of July shows net income of $1,400 based on Service
Expense $2,300, Supplies Expense $1,200, and Utilities Expense $600. In reviewing the statement, you d
1. Insurance expired during July of $400 was omitted.
2. Supplies expense includes $250 of supplies that are still on hand at July 31.
3. Depreciation on equipment of $150 was omitted.
4. Accrued but unpaid salaries and wages at July 31 of $300 were not included.
5. Services performed but unrecorded totaled $650.

Instructions
Prepare a correct income statement for July 2017.

MONTEE CO
Income Statement
For the month July, 2017
Revenue Debit Credit
Service Revenue $6,150
Expenses
Salaries and Wages Expense $2,600
Supplies Expense 950
Utilities Expense 600
Depreciation Expense 150
Insurance Expense 400
Total Expense 4,700
Net Income $1,450

Julian Lukman Simbolon

NIM 2440126966
$1,400 based on Service Revenue $5,500, Salaries and Wages
wing the statement, you discover the following:

Adjusting Entries for the month of July

1. Insurance expense dury July of $400
Insurance Expense 400
Prepaid Insurance 400
2. Supplies expense includes $250 of supplies that are still on hand at July 31
Supplies Expense 950
Supplies 950
3. Depreciation of equipment of $150
Depreciation Expense 150
Accumulated Depreciation 150
4. Unpaid salaries and Wages at July 31 of $300
Salaries and Wages Expense 300
Salaries and Wages Payable 300
5. Service performed but unrecorded total $650
Service Revenue 650
Account Receivable 650