Question 2 of 34 While examining the accounts of Grandma Company on December 31, 2015, the following errors were uncovered: ● Dividends of PI00,000 had been declared on December 15, 2015 but was not recorded in the books. ● Improvements in buildings and equipment for P480,000 had been debited to expense at the end of April in 2014. Improvements are estimated to h- estimated life of 8 years. The company failed to record sales commissions payable amounting to P10,500 and P19,000 at the end of 2014 and 2015, respectively. supplies on hand amounting to P6,000 and P15,000 were not recognized at the end of 2014 and 2015, respectively. What is the net effect of the above errors in the 2014 net income? - ● Select the correct response: P423,500 under P435,500 under P463,500 under

Question 2 of 34 While examining the accounts of Grandma Company on December 31, 2015, the following errors were uncovered: ● Dividends of PI00,000 had been declared on December 15, 2015 but was not recorded in the books. ● Improvements in buildings and equipment for P480,000 had been debited to expense at the end of April in 2014. Improvements are estimated to h- estimated life of 8 years. The company failed to record sales commissions payable amounting to P10,500 and P19,000 at the end of 2014 and 2015, respectively. supplies on hand amounting to P6,000 and P15,000 were not recognized at the end of 2014 and 2015, respectively. What is the net effect of the above errors in the 2014 net income? - ● Select the correct response: P423,500 under P435,500 under P463,500 under

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Description: Question 2 of 34While examining the accounts of Grandma Company on December 31, 2015, the following errors were uncovered:Dividends of PI00,000 had been declared on December 15, 2015 but was not recorded in the books.Improvements in buildings and eq

Financial & Managerial Accounting

13th Edition

ISBN:9781285866307

Author:Carl Warren, James M. Reeve, Jonathan Duchac

Publisher:Carl Warren, James M. Reeve, Jonathan Duchac

Chapter1: Introduction To Accounting And Business

Section: Chapter Questions

Problem 1.25EX

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The transactions completed by PS Music during June 2016 were described at the end of Chapter 1. The following transactions were completed during July, the second month of the businesss operations: July 1. Peyton Smith made an additional investment in PS Music by depositing 5,000 in PS Musics checking account. 1. Instead of continuing to share office space with a local real estate agency, Peyton decided to rent office space near a local music store. Paid rent for July, 1,750. 1. Paid a premium of 2,700 for a comprehensive insurance policy covering liability, theft, and fire. The policy covers a one-year period. 2. Received 1,000 on account. 3. On behalf of PS Music, Peyton signed a contract with a local radio station, KXMD, to provide guest spots for the next three months. The contract requires PS Music to provide a guest disc jockey for 80 hours per month for a monthly fee of 3,600. Any additional hours beyond 80 will be billed to KXMD at 40 per hour. In accordance with the contract, Peyton received 7,200 from KXMD as an advance payment for the first two months. 3. Paid 250 on account. 4. Paid an attorney 900 for reviewing the July 3 contract with KXMD. (Record as Miscellaneous Expense.) 5. Purchased office equipment on account from Office Mart, 7,500. 8. Paid for a newspaper advertisement, 200. 11. Received 1,000 for serving as a disc jockey for a party. 13. Paid 700 to a local audio electronics store for rental of digital recording equipment. 14. Paid wages of 1,200 to receptionist and part-time assistant. Enter the following transactions on Page 2 of the two-column journal: July 16. Received 2,000 for serving as a disc jockey for a wedding reception. 18. Purchased supplies on account, 850. 21. Paid 620 to Upload Music for use of its current music demos in making various music sets. 22. Paid 800 to a local radio station to advertise the services of PS Music twice daily for the remainder of July. 23. Served as disc jockey for a party for 2,500. Received 750, with the remainder due August 4, 2016. 27. Paid electric bill, 915. 28. Paid wages of 1,200 to receptionist and part-time assistant. 29. Paid miscellaneous expenses, 540. 30. Served as a disc jockey for a charity ball for 1,500. Received 500, with the remainder due on August 9, 2016. 31. Received 3,000 for serving as a disc jockey for a party. 31. Paid 1,400 royalties (music expense) to National Music Clearing for use of various artists music during July. 31. Withdrew 1,250 cash from PS Music for personal use. PS Musics chart of accounts and the balance of accounts as of July 1, 2016 (all normal balances), are as follows: Instructions 1. Enter the July 1, 2016, account balances in the appropriate balance column of a four-column account. Write Balance in the Item column, and place a check mark () in the Posting Reference column. (Hint: Verify the equality of the debit and credit balances in the ledger before proceeding with the next instruction.) 2. Analyze and journalize each transaction in a two-column journal beginning on Page 1, omitting journal entry explanations. 3. Post the journal to the ledger, extending the account balance to the appropriate balance column after each posting. 4. Prepare an unadjusted trial balance as of July 31, 2016.
Problem 3.7 The Oakland Mills Company has disclosed the following financial information in its annual reports for the period ending March 31, 2011: sales of $1,272,973, costs of goods sold of $720,878.62, depreciation expenses of $175,000, and interest expenses of $89,575. Assume that the firm has a tax rate of 35 percent. What is the company's net income? Set up an income statement to answer the question. (Round answers to 2 decimal places, e.g. 15.25)
Ex5.22The following transactions of Larson Services Inc. occurred during August 2019, its first month ofoperations.Aug. 1 Issued common stock for $3,000 cash1 Borrowed $10,000 cash from the bank1 Paid $8,000 cash for a used truck4 Paid $600 for a one–year truck insurance policy effective August 1 (record as an asset)5 Collected $2,000 fees from a client for work to be performed at a later date7 Billed a client $5,000 for services performed today9 Paid $250 for supplies purchased and used today12 Purchased $500 of supplies on credit (record as an asset)15 Collected $1,000 of the amount billed August 716 Paid $200 for advertising in The News during the first two weeks of August20 Paid $250 of the amount owing for supplies purchased on August 1225 Paid the following expenses: rent for August, $350; salaries,$2,150; telephone, $50; truck operating, $25028 Called clients about payment of the balances owing from August 729 Billed a client $6,000 for services performed today, including $1,500…
CHAPTER 3TRUE-FALSE STATEMENTS1. Many business transactions affect more than one time period.2. The time period assumption states that the economic life of a business entity can bedivided into artificial time periods.3. The time period assumption is often referred to as the expense recognition principle.4. A company's calendar year and fiscal year are always the same.5. Accounting time periods that are one year in length are referred to as interim periods.MULTIPLE CHOICE QUESTIONS1. Monthly and quarterly time periods are calleda. calendar periods.b. fiscal periods.c. interim periods.d. quarterly periods. 2. The time period assumption states thata. a transaction can only affect one period of time.b. estimates should not be made if a transaction affects more than one time period.c. adjustments to the enterprise's accounts can only be made in the time period when thebusiness terminates its operations.d. the economic life of a business can be divided into artificial time periods. 3. An…
QUESTION NO.17 From the following balances of Ali,Ahmed as on 31.12.2016, Opening stock 30,000 Machinery at cost (including ~ 10,000 new) 60,000 Purchases 1,10,000 Sundry Debtors 20,000 Sales 2,50,000 Bad debts 3,000 Building 55,000 Depreciation fund 25,000 Wages 23,000 Sundry Creditors 24,000 Carriage inwards 3,000 Rent,rates and taxes 4,000 Bills payable 10,000 Trade expenses 4,000 Furniture 9,000 Capital : Ali 50,000 Salaries 42,000 Capital : Ahmed 40,000 Advertisement 24,000 Petty expenses 4,000 Coal and coke 2,000 Provision for bad debts 1,000 Cash at bank 14,000 Gas and water 1,200 Prepaid wages 1,000 Cash in hand 800 Depreciation fund investment 25,000 Outstanding rent 400 Bank loan 34,600 The following additional information is supplied: (a) The partners share profits and losses as Ali 2/5 and Ahmed 3/5. (b) Closing stock ---- ~ 15,000. (c) Stock valued at ~ 10,000 was destroyed by fire but the Insurance…
Part B ( 7 marks) (Note this question IS related to Part A) SuperElectronics Limited Adjusted Trial Balance As at 30 June 2020 Debit Credit $ $ Cash 87,000 Accounts receivable 89,000 Allowance for Doubtful debts 4,300 Supplies 4,000 Plant & Equipment 218,000 Accumulated depreciation 64,000 Accounts Payable 38,000 Wages Payable 11,500 Loan payable ( not due until 2025) 50,000 Share capital 100,000 Retained Earnings 105,250 Dividends paid 10,000 Sales Revenue 368,000 Interest revenue 1,120 Doubtful debts expense 2,460 Depreciation expense 19,680 Rent & utilities expense 19,230 Wages and Salaries expense 281,000 Advertising expense 9,300 Interest expense 2,500 Totals 742,170 742,170 Required Prepare the Statement of Financial Position ( Balance…
Q2 Additional Information: A. Closing stock Rs. 87,210.B. Depreciation to be provided on machinery and plant at 10% and office furniture at 5%.C. The provision for bad debts is to be increased by Rs. 4,000.D. Outstanding wages Rs. 3,210 and salaries Rs.920.E. Insurance premium Rs. 2,400 is included in machinery repairs by mistake. Requires: Prepare trading and profit and loss account for the year ended 31st December 2006 anda balance sheet as on that date.
Expert Q&AMy solutions Notifications Student question Time Left : 01:54:13 Effects of Errors on Financial Statements For a recent year, the balance sheet for The Campbell Soup Company (CPB) includes accrued liabilities of $598 million. The income before taxes for the year was $2,153 million. a. Assume the accruals apply to the current year and were not recorded at the end of the year. a. Assume the accruals apply to the current year and were not recorded at the end of the year. By how much would income before taxes have been misstated? Enter your answer in millions. $fill in the blank 1 million b. What is the percentage of the misstatement in (a) to the reported income of $2,153 million? fill in the blank