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Transaction analysis for various transactions

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Transaction/Adjustment Current Assets Current Liabilities Long Term Debt Net Income

Enter the transaction/adjustment letter in the first column, and show the effect, if any, of each of the transactions/adjustments on the appropiate balance sheet category or on the income statement by entering the amount and indicating whether it is an addition (+) or a subtraction (-). You may also write the journal entries to record each transaction/adjustment.

A) Wages of $768 accrued at the end of the prior fiscal period were paid this fiscal period.

B) Real Estate tax of $2400.00 applicable to the current period have not been accrued.

C) Interest on bonds payable has not been accrued for the current month. The company has outstanding $360,000 of 7.5% bonds.

D) The premium related to the bonds in part c has not been amortized for the current month. The current month amortization is $70.00

E) Based on past experience with its warranty program, the estimated warranty expense for the current period should be 0.2% of sales of $918,000.

F) Analysis of the company's income taxes indicate that taxes currently payable are $76,000 and that the deferred tax liability should be increased by $21,000.

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Solution Summary

The solution presents a transaction analysis and the journal entries in proper form complete with calculations and explanations.

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