Financial Accounting: An Integrated Statements Approach, 2nd Edition

Adjustment data for Tyro Health Care Inc. for March are as follows:

1. Insurance expired, $360.


2. Supplies on hand on March 31, $870.


3. Depreciation on building, $1,200.


4. Unearned rent revenue earned, $1,800.


5. Wages owed employees but not paid, $850.


6. Services provided but not billed to patients, $6,000.

Instructions

Based upon the transactions recorded in March for Problem 3-1B, record the adjustments for

March using the integrated financial statement framework.

Data for Tyro Health Care Inc. for March are provided in Problems 3-1B and 3-2B.

Instructions

Prepare an income statement, retained earnings statement, and a classified balance sheet for

March. The notes payable is due in 2018.

Data for Tyro Health Care for March are provided in Problems 3-1B, 3-2B, and 3-3B.

Instructions

1. Prepare a statement of cash flows for March.


2. Reconcile the net cash flows from operating activities with the net income for March.
   Hint:See the appendix to this chapter and use adjusted balances in computing increases and
   decreases in accounts.

At the end of November, the first month of operations, the following selected data were taken

from the financial statements of Jaime McCune, Attorney-at-Law, P.C.

Net income for November $207,320

Total assets at November 30 440,960

Total liabilities at November 30 29,720

Total stockholders’ equity at November 30 411,240

In preparing the financial statements, adjustments for the following data were overlooked:

a. Supplies used during November, $1,025.

b. Unbilled fees earned at November 30, $7,650.

c. Depreciation of equipment for November, $3,100.

d. Accrued wages at November 30, $1,100.

Instructions

Determine the correct amount of net income for November and the total assets, liabilities, and

stockholders’ equity at November 30. In addition to indicating the corrected amounts, indicate

the effect of each omitted adjustment by setting up and completing a columnar table similar to

the following. Adjustment (a) is presented as an example.

140 Chapter 3 Accrual Accounting Concepts

Alternate Problem

3-2B

Adjustment process

Goal 3

GENERAL LEDGER

Alternate Problem

3-3B

Financial statements and the

closing process

Goals4, 6

1. Net income, $8,040

GENERAL LEDGER

Alternate Problem

3-4B

Statement of cash flows

Goal 4

1. Net cash flows from
   operating activities, ($4,100)

GENERAL LEDGER

Alternate Problem

3-5B

Adjustments and errors

Goal 3

Corrected net income,

$209,745