On December 31,2011,Krug Company reported pretax income of $120,000 prior to the following adjusting entries:
Depreciation expense was $31,000;
Accrued service revenues totaled $29,000;
Accrued expenses totaled $12,000;
Expired insurance which was prepaid totaled $9,000;
Rent revenue earned was $7,000; the rent was prepaid by the tenant and credited to unearned rent revenue.
How much is Krug's pretax income after adjusting entries?

Question

On December 31,2011,Krug Company reported pretax income of $120,000 prior to the following adjusting entries:
 Depreciation expense was $31,000;
 Accrued service revenues totaled $29,000;
 Accrued expenses totaled $12,000;
 Expired insurance which was prepaid totaled $9,000;
 Rent revenue earned was $7,000; the rent was prepaid by the tenant and credited to unearned rent revenue.
How much is Krug's pretax income after adjusting entries?

Quizplus · Accepted Answer

Pretax income = $104,000 = $120,000 - $31,000 + $29,000 - $12,000 - $9,000 + $7,000

On December 31,2011,Krug Company Reported Pretax Income of $120,000 Prior