Expenses: Advertising Expense $14,000
Insurance expense 20,000
Salaries expense 49,000
Rent expense 10,000

Liabilities:
Salaries payable 12,000
Notes payable 36,000

Dividends:
Dividends 9,000

Assets:
Cash 26,000
Accounts receivable 24,000
Supplies 15,000
Land 55,000

Revenues:
Service revenue 94,000
Interest revenue 9,000

Equity :
Common stock 44,000
Retained earnings 27,000

Assume the company has an increase in its Salaries Expense of 20% and a decrease in Service Revenue of 15%. Both of which will be settled after the year end. Adjust and recalculate the balances in the Income Statement and Balance Sheet. All sales are on account.

Required:
a. What is the revised balance in Accounts Receivable?

1. $11.900
2. $9,900
3. $17,900
4. $4,900

b. What is the revised balance in Salaries Payable?

1. $5,500
2. $10,500
3. $21,800
4. $18,500