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Before Month-End Adjustments Are Made, the February 28 Trial Balance \bullet

Question 177

Essay

Before month-end adjustments are made, the February 28 trial balance of Alice's Adventures contains revenue of $9,000 and expenses of $4,400. Adjustments are necessary for the following items:
\bullet Depreciation for February is $1,800.
\bullet Revenue earned but not yet billed is $2,300.
\bullet Accrued interest expense is $700.
\bullet Revenue collected in advance that is now earned is $3,500.
\bullet Portion of prepaid insurance expired during February is $400.
Instructions
Calculate the correct net income for Alice's Income Statement for February.

Correct Answer:

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