Galaxy Corporation had the following financial statement information:
align=”left”>
|
2006 |
2005 |
|
|
Revenue |
$135,000 |
$100,000 |
|
Expenses |
98,000 |
65,000 |
|
Net income |
37,000 |
35,000 |
align=”left”>
|
12-31-06 |
12-31-05 |
|
|
Total assets |
$157,000 |
$105,000 |
|
Total liabilities |
50,000 |
35,000 |
|
Total owners’ equity |
107,000 |
70,000 |
Galaxy failed to record $12,000 of accrued wages at the end of 2005. The wages were recorded and paid in January 2006. Assuming that the correct accruals were made on December 31, 2006, what are the corrected balances in the 2005 and 2006 restated financial statements?
align=”left”>
|
2005 net income |
Dec. 31, 2005 total liabilities |
Dec. 31, 2006 total owners’ equity |
|
|
a. |
$23,000 |
$23,000 |
$ 95,000 |
|
b. |
$47,000 |
$47,000 |
$107,000 |
|
c. |
$23,000 |
$35,000 |
$ 95,000 |
|
d. |
$23,000 |
$47,000 |
$107,000 |