On December 31, Trinkets Supply Company noted the following transactions that occurred during 2015, some or all of which might require adjustment to the books. (a)Payment of $4,300 to suppliers was made for purchases on account during the year and was not recorded. (b)Building and land were purchased on January 2 for $190,000 . The building’s fair value was $141,000 at the time of purchase. The building is being depreciated over a 30-year life using the straight-line method, assuming no salvage value. (c)Of the $52,000 in Accounts Receivable, 5% is estimated to be uncollectible. Currently, Allowance for Bad Debts shows a debit balance of $200 . (d)On September 1, $80,000 was loaned to a customer on a 12-month note with interest at an annual rate of 11% . (e)During 2015, Trinkets Supply received $15,200 in advance for services, 80% of which will be performed in 2016. The $15,200 was credited to Sales Revenue. (f)The interest expense account was debited for all interest charges incurred during the year and shows a balance of $2,300 . However, of this amount, $300 represents a discount on a 60-day note payable, due January 30, 2016. INSTRUCTIONS: Give the necessary adjusting entries to bring the books up to date. Indicate the net change in income as a result of the foregoing adjustments.

On December 31, Trinkets Supply Company noted the following transactions that occurred during 2015, some or all of which might require adjustment to the books.

(a)Payment of $4,300 to suppliers was made for purchases on account during the year and was not recorded.
(b)Building and land were purchased on January 2 for $190,000 . The building’s fair value was $141,000 at the time of purchase. The building is being depreciated over a 30-year life using the straight-line method, assuming no salvage value.
(c)Of the $52,000 in Accounts Receivable, 5% is estimated to be uncollectible. Currently, Allowance for Bad Debts shows a debit balance of $200 .
(d)On September 1, $80,000 was loaned to a customer on a 12-month note with interest at an annual rate of 11% .
(e)During 2015, Trinkets Supply received $15,200 in advance for services, 80% of which will be performed in 2016. The $15,200 was credited to Sales Revenue.
(f)The interest expense account was debited for all interest charges incurred during the year and shows a balance of $2,300 . However, of this amount, $300 represents a discount on a 60-day note payable, due January 30, 2016.

INSTRUCTIONS:

Give the necessary adjusting entries to bring the books up to date.

Indicate the net change in income as a result of the foregoing adjustments.