Describe the accounting for correction of errors.

Q: Explain receivables conversion period

A: It is the time interval connecting the sale of the last item using a credit card and cash receipts…

Q: What is the Tolerable Error Rate?

A:

Q: Define Errors.

A: Accounting error means occurrence of mistakes which are committed while recording the transactions…

Q: How would you find errors in recording transactions and what is the process to correct errors?

A: Often, adding a journal entry will fix an accounting error. The journal entry adjusts the retained…

Q: The correct amount of the check

A: The amount by which the check is required to be corrected = Amount entered in the Cash Disbursement…

Q: Which answer below is the result of this error?

A: In the given case, the journal entry is recorded incorrectly. Due to which the service revenue will…

Q: What is the difference between adjusting entries and correcting entries? Which method is better and…

A: Difference between adjusting entries and correcting entries:Usually, adjusting entries are needed at…

Q: How efficient is an Analysis at the account level technique?

A: The question is to discuss efficiency of financial analysis at account level or based on the data…

Q: What are the different risks associated in the accounting of inventories?

A: Answer: Inventories are the current assets of the company which are realizable within 12 months from…

Q: For each of the following independent scenarios, indicate the effect of the error (if any) on:

A: Step 1 Journal is the part of book keeping.

Q: What is meant by Wraparound filing?

A: Financial reporting: Financial reporting is the procedure used to communicate the information…

Q: How are errors corrected if they're not properly accounted for?

A: The errors can happen as all the things are human oriented. The error can happen as the process of…

Q: What are the classes of transcription errors?

A: Definition: Internal control: Internal control is a process which ensures continuous reliability of…

Q: How does Target record repairs and maintenance expense?

A: Revenue expenditures:   These costs are incurred to maintain the long-term asset in good condition…

Q: In correction of combined errors, you need to be careful with counterbalancing and non-…

A: Counter Balancing Errors If the effect of an error in one account is cancelled by the effect of one…

Q: Discuss the correction of errors in more detail.

A: Errors in Accounting: Error is a mistake committed in book keeping.

Q: Distinguish between counterbalancing and noncounterbalancing errors. Give an example of each.

A: Difference:Counterbalancing errors are the type of errors that cancels out or equalize other error…

Q: Expense recognition is implemented by one of four different approaches, depending on the nature of…

A:

Q: Define expense recognition principle

A: Expense recognition principle says that all expenses for the particular period must be recognized in…

Q: Calculate the missing values +

A: Net income is the income which has been earned by the company during the year when all the expenses…

Q: Of what merit is the contention that the allowance methodlacks the objectivity of the direct…

A: Direct write-off method: This method does not make allowance or estimation for uncollectible…

Q: Define and describe auditsampling for exception rates

A: Audit sampling: Audit sampling can be defined as the selection of items from a population to be used…

Q: Briefly explain the purposes of adjustments.

A: Adjustments (Adjusting entries) : These are made to record the business transactions that has been…

Q: Explain the difference between contract assets, contract liabilities, and accounts receivable.

A: Account receivable: The amount of money to be received by a company for the sale of goods and…

Q: Distinguish between counterbalancing and non-counterbalancing errors. Give an example of each.

A: Distinguish between counterbalancing and non-counterbalancing errors. Give an example of each.…

Q: Which is an error of omission

A: Accounting error is error in entering, computing, and analysis of data. This includes the recording…

Q: How does the Genral Ledger work?

A: General ledger is the account prepared by the company for each transactions made by the company. It…

Q: Name the error which was made under the following circumstances:

A: The error of omission is a type of error that takes the account of results caused due inactions or…

Q: How would you find errors in recording transactions and what is the process to correct errors?…

A: Accounting error: Accounting errors can be defined as omission of the fundamental accounting…

Q: Make an acronym or a mnemonic on the new revenue recognition standards and make a comparison with…

A: Revenue recognition is a generally accepted accounting principles, that identifies…

Q: Define Current Receivables.

A: Current receivables are recorded under current assets of the company.

Q: The correction of errors is the situation that creates prior period adjustments. Explain what are…

A: Prior period adjustments:   The corrections or adjustments that are made to the current year…

Q: Explain the accounting issues for recording goodwill.

A: Definition:   Goodwill: In terms of accounting, goodwill may be defined as an intangible asset that…

Q: What are some of the possible costs that could result from a revision of an accounting standard?

A: Financial Accounting Standards Board (FASB):   It is a private, non-profit organization which is a…

Q: Counter balancing error is sometimes referred to as: which of the following? a Compensating errors…

A: Rectification entry means where some error has been done in past and we need to rectify that errors.…

Q: Discuss the three common methods of handling errors in transaction files.

A: Errors in the books of accounting should be corrected as soon as possible, so that the financial…

Q: How to calculate breakeven balance

A: Break even analysis explains how much total revenue is required to cover both the fixed and variable…

Q: Identify and explain the various stages of and parties to the collection of a check.

A: Cheque refers to a financial document which acts as an order to a bank to pay a particular amount of…

Q: Define risk of material misstatement.

A: Material misstatement represents the statement presented in the financial statement which is…

Q: Describe the problems that might come from using an incorrect bill of material in MRP.

A: About Bill of Material Once of the most significant master data elements of any manufacturing ERP…