Question
Asked Nov 29, 2019
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Assume that Sunshine Realty Co. borrowed $300,000 from Columbia First Bank and Trust. In recording the transaction, Sunshine erroneously recorded the receipt as a debit to Cash, $300,000, and a credit to Fees Earned, $300,000. (a) How would this error affect the equality of the trial balance? (b) How would this error affect the income statement, statement of owner’s equity, and balance sheet?
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Expert Answer

Step 1

a) Identify the manner in which the given error would affect the equality of the trial balance.

The given error would not affect the equality of the trail balance, b...

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