1. Genius Company reported an Accumulated Profits and Losses balance of P300,000 at December 31, 2014. In June 2015, Genius discovered that merchandise costing P100,000 had not been included in inventory in its 2014 financial statements. Assume Genius has 32% tax rate. What amount should Genius report as adjusted beginning Accumulated Profits and Losses on January 1, 2015? 2. Cola Company reported an Retained earnings balance of P400,000 at December 31, 2014. In August 2015, Cola Company determined that insurance premiums of P75,000 for the three-year period beginning January 1, 2014, had been paid and fully expensed in 2014. Assume Cola has a 32% income tax rate. What amount should Cola report as adjusted beginning Retained earnings in 2015?
1. Genius Company reported an Accumulated Profits and Losses balance of P300,000 at December 31, 2014. In June 2015, Genius discovered that merchandise costing P100,000 had not been included in inventory in its 2014 financial statements. Assume Genius has 32% tax rate. What amount should Genius report as adjusted beginning Accumulated Profits and Losses on January 1, 2015? 2. Cola Company reported an Retained earnings balance of P400,000 at December 31, 2014. In August 2015, Cola Company determined that insurance premiums of P75,000 for the three-year period beginning January 1, 2014, had been paid and fully expensed in 2014. Assume Cola has a 32% income tax rate. What amount should Cola report as adjusted beginning Retained earnings in 2015?
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter22: Accounting For Changes And Errors.
Section: Chapter Questions
Problem 5E: Fava Company began operations in 2018 and used the LIFO inventory method for both financial...
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1. Genius Company reported an
31, 2014. In June 2015, Genius discovered that merchandise costing P100,000 had not been
included in inventory in its 2014 financial statements. Assume Genius has 32% tax rate.
What amount should Genius report as adjusted beginning Accumulated Profits and
Losses on January 1, 2015?
2. Cola Company reported an Retained earnings balance of P400,000 at December 31, 2014. In
August 2015, Cola Company determined that insurance premiums of P75,000 for the three-year
period beginning January 1, 2014, had been paid and fully expensed in 2014.
Assume Cola has a 32% income tax rate. What amount should Cola report as adjusted
beginning Retained earnings in 2015?
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