During the course of your examination of the financial statements of Trojan Corporation for the year ended December 31, 2015, you come across several items needing further consideration. Currently, net income is $94,000

a. An insurance policy covering 12 months was purchased on October 1, 2015, for $20,400. The entire amount was debited to Prepaid Insurance and no adjusting entry was made for this item in 2015.
b. During 2015, the company received a $3,400 cash advance from a customer for services to be performed in 2016. The $3,400 was incorrectly credited to Service Revenue.
c. There were no supplies listed in the balance sheet under assets. However, you discover that supplies costing $2,450 were on hand at December 31, 2015.
d. Trojan borrowed $64,000 from a local bank on September 1, 2015. Principal and interest at 9% will be paid on August 31, 2016. No accrual was made for interest in 2015.

adjusted income:  92,830

adjusted income:  92,830

adjusted income:  92,830

Explanation:

a) 20,400 contract for a year

20,400 / 12 = 1,700 value per month

from Oct 1st to Dec 31th:  3 months for a total of 5,100 expense

b) we should decrease revenue by 3,400

c) we should reverse 2,450 supplies expense and post under supplies

d) principal x rate x time = interest

64,000 x 0.09 x 4/12 = 1,920 interest expense

94,000 - 5,100 insurance expense + 3,400 unearned revenue +2,450 reversing of supplies expense - 1,920 interest expense

adjusted income:  92,830

in 2001, dell computer became the world’s largest personal computer vendor, continuing to

gain market share and post profits in an industry struggling with slumping sales and billions of

dollars in losses. dell sells 90% of its pcs directly to the final customer, largely bypassing the

reseller channel that accounts for most of the world’s pc sales. this direct customer relationship

is the key to dell’s business model, and provides distinct advantages over the indirect sales

model. dell’s direct relationship with the customer allows it to tailor its offerings to customer

needs, offer add-on products and services, and use the internet to offer a variety of customer

services. in addition, dell’s pcs are built to customers’ specifications upon receipt of an order,

giving dell additional advantages over indirect pc vendors who must try to forecast demand and

ship products based on those forecasts. dell’s direct sales and build-to-order model has achieved

superior performance in the pc industry in terms of inventory turnover, reduced overhead, cash

conversion, and return on investment (kraemer, et al., 2000).

explanation:

i think the answer is a. science center.