HWK__5-1 - HOMEWORK #5 DUE SEPT. 26 6 points KRG...

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HOMEWORK #5 DUE SEPT. 26 6 points KRG Corporation adjusts its accounts only at year-end. Prior to making their year-end adjustments, KRG had a Net Income of $88,000. The following information is available as a source for preparing the adjusting entries at December 31, 2008: 1. On September 1, 2008, the corporation collected six months’ rent of $4,800 on storage space. At that date the company debited Cash and credited Unearned Revenue for the full amount. 2. A ten-month bank loan in the amount of $20,000 had been obtained on April 1. Interest is to be computed at an annual rate of 7% and is payable when the loan becomes due (matures). 3. Depreciation on the fleet of service trucks owned by the campgrounds is based on a life of 5 years and a salvage value of $20,000. The original cost of the trucks two years ago was $200,000. The straight-line method of depreciation is used. 4. On November 1, 2008, the company paid a one-year premium for fleet insurance of $4,200, with coverage starting on that date.
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This note was uploaded on 12/02/2008 for the course ACCT 201 taught by Professor Anothony during the Spring '07 term at Michigan State University.

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HWK__5-1 - HOMEWORK #5 DUE SEPT. 26 6 points KRG...

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