Problem 1: 20 points. 20 minutes Angus Insurance Agency prepares monthly financial statements. The agency generatan its

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Problem 1 20 Points 20 Minutes Angus Insurance Agency Prepares Monthly Financial Statements The Agency Generatan Its 1 (70.32 KiB) Viewed 75 times

Problem 1: 20 points. 20 minutes Angus Insurance Agency prepares monthly financial statements. The agency generatan its revenue from commissions on the insurance policies sold Presented below is on income statement for the month of June that is correct on the basis of information considered ANGUS INSURANCE AGENCY Income Statement For the Month Ended June 30 . ***** Revenues Commission Revenue Expenses $35,000 Salary expense $6.000 Rent expense 4,200 Depreciation expense. 2,800 Advertising expense... 800 Total expenses 13.800 Net income $21.200 Additional Data: When the income statement was prepared, the company accountant neglected to take into consideration the following information: 1. A utility bill for $2,000 was received on the last day of the month for electric and gas service for the month of June. 2. A company insurance salesman sold a life insurance policy to a client for a price of $35,000. The agency billed the client for the policy and is entitled to a commission eamed of 20% 3. Supplies on hand at the beginning of the month were $3,000. The agency purchased additional supplies during the month for $3,500 in cash and $2,200 of supplies were on hand at June 30, 4. The agency purchased a new car at the beginning of the month for $19,200 cash. The car will depreciate $4,800 per year. 5. Salaries owed to employees at the end of the month total $5,300. The salaries will be paid on July 5. Instructions 1. Prepare the necessary adjusting entries for the events listed in #1 through 5 above. Omd explanations