What should be reported as the correct 2029 pretax income?
Q: You have been engaged to audit the financial statements of LUNA Corp for the year ended December 31,…
A: Adjusting entries are nothing but journal entries that are recorded at the end of the reporting…
Q: JYD Corporation has determined its 2019 and 2020 net income figures to be P1,150,000 and P1,100,000,…
A: After audit, corrections are made to ascertain the correct profit for the period During audit if…
Q: Farley Bains, an auditor with Nolls CPAs, is performing a review of Ryder Company’s Inventory…
A: Certain costs does not form part of Inventory Obsolete Inventory Office Supplies Goods received…
Q: JYD Corporation has determined its 2019 and 2020 net income figures to be $1,150,000 and $1,100,000,…
A: Error and correction: Error and financial statements include mistakes regarding mathematical,…
Q: Upon inspection of the records of Eisenhower Company in connection to its financial statement audit…
A: * Prepaid insurance for 3 months of 2022 is adjusted as they are paid in advance * Opening inventory…
Q: During its first and second years of operations, Explorer Company, a corporation using a periodic…
A: Inventory is one of the current asset of the business, which is reported in the balance sheet of the…
Q: E6-2 Farley Bains, an auditor with Nolls CPAs, is performing a review of Ryder Company's nventory…
A: Step 1 Inventory cost must be determined to find the correct value of product
Q: The management of Sarasota Instrument Company had concluded, with the concurrence of its independent…
A: Earnings per share is a financial ratio that indicates a company’s ability to earn revenue for its…
Q: pany discovered a computational error of P150,000 in the calculation of the December 31, 2021…
A: Retained earnings refers to the amount which company remained from profit after paying all the…
Q: During your audit of the books of Antigua Corporation for the year ended December 31, 2021, you…
A: Accounting Errors: These are the errors that are caused by either mistake made when processing…
Q: ROBLEM: Sharp Company received P 80,000 of inventory items on the last day of its fiscal year, May…
A: The periodic inventory system is a method of inventory valuation for financial reporting purposes in…
Q: During 2021, WMC Corporation discovered that its ending inventories reported on its financial…
A: Inventory can be defined as: Stock of raw material held for production into final products. Stock…
Q: Kari Downs, an auditor with Wheeler CPAs, is performing a review of Waterway Company’s inventory…
A: SOLUTION- INVENTORY- IT IS A TERM FOR GOODS AVAILABLE FOR SALE AND RAW MATERIAL USED TO PRODUCE…
Q: Henson company had determined the 2019 and 2020 net income to be 4,000,000 and 5,000,000…
A: Net income is total earning of a firm that is obtained by sales-cost of goods sold ,operating…
Q: Farley Bains, an auditor with Nolls CPAs, is performing a review of Teal Mountain Inc.’s Inventory…
A: Inventory is a current asset to the company. It consist of goods available for sale, goods in…
Q: During 20Y5, the accountant discovered that the physical inventory at the end of 20Y4 had been…
A:
Q: Farley Bains, an auditor with Nolls CPAs, is performing a review of Waterway Company’s Inventory…
A: Prepare a schedule to determine the correct inventory amount as shown below:
Q: 1. What is the adjusted net income for 2021? VIXEN Corporation is in the process of adjusting the…
A: Answer to the above is 1,940,000 Explanation given below. Important note: Closing stock of one year…
Q: Sterling Company reported their inventory as $50,700 on the books at December 31, 2021. At the close…
A: Correct amount of inventory is the value of the inventory which has been computed on the basis of…
Q: After the auditors counted the inventory of Cracker Jack Manufacturing Co. and reviewed the…
A: Ending inventory is the stock of unfinished and semi-finished material of the company at the end of…
Q: You are auditing the financial statement of Pasig You have discovered that the merchandise inventory…
A: Errors include omisssions. impact of previous year errors will also consider for correction of…
Q: The Relief Goods Corp. reported profit before taxes of ₱370,000 for 2019 and ₱526,000 for 2020. A…
A: Merchandising inventory is the closing inventory of the company held by the firm at the end of the…
Q: BETA Company began operations in January 2021. Financial statements for the years ended December 31,…
A: Effects of 2021 errors on 2022 Ending Inventory 16000-Understated +16000…
Q: Wikki Inc. had the following transactions for the current year with respect to its inventory:
A: Unrealized holding gain is that results from holding on to an investment. It does not realize the…
Q: Tretorn Company began operations in 2018. During the first two years of operations, Tretorn made…
A: "Since you have asked multiple questions, we will solve first question for you. If you want any…
Q: Net income for Mory Company for the years 2021 and 2022 is shown below. An audit of the accounts,…
A: Answer) Calculation of Correct Net Income for the year 2021 2021 Net Income After Tax…
Q: 6) After the ISsuance of the 2023 financial statements, Orange Company discovered a computational…
A: solution : error : overstatement of cost of goods sold for the year ended december 31 ,2023 the…
Q: Case 5 You are auditing the financial statement of Pasig Company for the fllst tume You have…
A: Accrued salary-decrease income Accrued interest income-increase income
Q: BETA Company began operations in January 2021. Financial statements for the years ended December 31,…
A: Retained earnings refer to the amount of profit which is retained by the business entity after the…
Q: After the issuance of the 2021 financial statements, Pine Company discovered a computational error…
A: Due to error, there is overstatement of COGS, this has resulted in less profit reporting. In order…
Q: For each item, indicate by placing an X in the appropriate column(s) on the answer sheet whether the…
A: For the given errors, we have to specify the understatement and overstatement of income in year 2020…
Q: In 2021, the controller of Sytec Corporation discovered that $42,000 of inventory purchases were…
A: 1. Determine the effects of the errors on retained earnings at January 1, 2021. In the year 2020,…
Q: The following is an independent error made by a company that uses the periodic inventory system:…
A: Journal entry: Journal entry is a set of economic events which can be measured in monetary terms.…
Q: The results of your audit of Heave Company for 2 consecutive years are shown below: a. Net income…
A: “Since you have asked multiple question, we will solve the first question for you. If youwant any…
Q: The condensed statement of income of LUNA, Inc. for the year ended December 31, 2020 is presented…
A: Adjusting entries journal entries that are passed at the conclusion of a financial year in order to…
Q: On April 1, 2020, you were hired by Binus Inc., a closely held company, as a staff member of its…
A: The inventory is presented in the balance sheet under the head current assets. Whereas, the cost of…
Q: ABC Company experienced a decline in the value of its inventory in 2020 which resulted in a…
A: Inventory write-down refers to the accounting process to record decrease in value of the inventory…
Q: You are engaged in the audit of Company reported the following net income for 2019 to 2021: 2021:…
A: The prepaid expenses are the expenses paid but not expired yet. The Unearned income is the income…
Q: Understatement of ending inventory 25,000 30,000 Overstatement of ending inventory 16,000…
A: Correct net income is calculated after making adjustments in the net income and correct retained…
Q: Upon inspection of the records of Eisenhower Company in connection to its financial statement audit…
A: To find a correct income need to add back the expense that does not belong to a year 2021 and less…
Q: In 2021, the internal auditors of Blooper Inc. discovered that goods costing $12 million that were…
A: A general journal is the book of accounts that is used to record all the transactions of the…
Q: Upon inspection of the records of Eisenhower Company in connection to its financial statement audit…
A: The net income is calculated as difference between revenue and expenses. The income statement…
Q: In January 2020, Susquehanna Inc. requested and secured permission from the commissioner of the…
A: Requirement a: Inventory: Inventory refers to the entire stock of goods purchased, goods…
Q: Clover Company, a corporation using a periodic inventory system, made undiscovered errors in taking…
A: Basic Accounting Concept Note for this question: Overstatement of Ending or Closing Inventory leads…
Q: A company reported the net income of $58,000 for the year ending 2018. However, it was discovered…
A: Net income:Net income can be defined as the income reported at the bottom of the income statement of…
Q: The adjusted (audited) income statement of Alex Kwon Corp. shows a net income of P175,000 for the…
A: 1) If the Opening inventory is overstated and if Ending inventory is understated, COGS is overstated…
During the audit of BAC Company's 2029 financial statements, the auditors discovered that the 2029 ending inventory had been understated by $12,000 and that the 2029 beginning inventory was overstated by $9,000. Before the effect of these errors, 2029 pretax income had been computed as $115,000.
What should be reported as the correct 2029 pretax income?
A) $112,000
B) $94,000
C) $118,000
D) $136,000
E) $103,000
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
- If Wakowski Companys ending inventory was actually $86,000 but was adjusted at year end to a balance of $68,000 in error, what would be the impact on the presentation of the balance sheet and income statement for the year that the error occurred, if any?If Barcelona Companys ending inventory was actually $122,000, but the cost of consigned goods, with a cost value of $20,000 were accidentally included with the company assets, when making the year-end inventory adjustment, what would be the impact on the presentation of the balance sheet and income statement for the year that the error occurred, if any?At the end of 2019, Manny Company recorded its ending inventory at 350,000 based on a physical count. During 2020, the company discovered that the correct inventory value at the end of 2019 should have been 400,000 because it made a counting error. Upon discovery of this error in 2020, what correcting journal entry will Manny make? Ignore income taxes.
- Tanke Company reported net income on the year-end financial statements of $850,200. However, errors in inventory were discovered after the reports were issued. If inventory was overstated by $21,000, how much net income did the company actually earn?Shetland Company reported net income on the year-end financial statements of $125,000. However, errors in inventory were discovered after the reports were issued. If inventory was understated by $15,000, how much net income did the company actually earn?Company Edgar reported the following cost of goods sold but later realized that an error had been made in ending inventory for year 2021. The correct inventory amount for 2021 was 12,000. Once the error is corrected, (a) how much is the restated cost of goods sold for 2021? and (b) how much is the restated cost of goods sold for 2022?
- Company Elmira reported the following cost of goods sold but later realized that an error had been made in ending inventory for year 2021. The correct inventory amount for 2021 was 32,000. Once the error is corrected, (a) how much is the restated cost of goods sold for 2021? and (b) how much is the restated cost of goods sold for 2022?During the course of an audit of the financial statements of Julie Company for the yearended December 31, 2019, the following data are discovered: Inventory on January 1, 2019 had been overstated by P300,000. Inventory on December 31, 2019 was understated by P500,000. An insurance policy covering three years had been purchased on January 1, 2018for P150,000. The entire amount was charged as an expense in 2018. During 2019, the entity received a P100,000 cash advance from a customer formerchandise to be manufactured and shipped during 2020. The amount had beencredited to sales revenue. The gross profit on sales is 50%.Net income for 2019 per book was P2,000,000. What is the proper net income for 2019?Determine the following as a result of your audit: a. What is the cost of ending inventories as of December 31, 2023? b. What is the correct carrying value inventories reported in its December 31, 2023 Statement of Financial Position? c. What is the amount of loss on inventory write down reported in its profit or loss in 2023 assuming that the allowance for inventory write down has a beginning balance of P35,000.
- In fiscal year 2020, the company had accumulated inventory impairment of 2000. In fiscal year 2021, the company considered that the required amount of accumulated impairment amounted to 1300 and thus reversed the difference in results. However, according to the Auditor, the required amount of accumulated impairment in the year 2021 amounted to 2500. If the amount of net profit of the income statement in 2021 is 20000, how much is the actual profit of the business?Henson company had determined the 2019 and 2020 net income to be 4,000,000 and 5,000,000 respectively. In a first time audit of the financial statements, the following errors are discovered: Merchandise inventory was incorrectly determined - 50,000 overstatement for 2019 and 150,000 overstatement for 2020 Revenues received in advance in 2019 of 300,000 was credited to be a revenue account when received. Of the total 50,000 was earned in 2019, 200,000 was earned in 2020 and the remainder will be earned in 2021. 400,000 gain on sale of plant asset in 2020 was erroneously credited to retained earnings. What is the corrected net income for 2020? a. 5,500,000 b.5,450,000 c.5,400,000 d.5,550,000After the issuance of the 2021 financial statements, Pine Company discovered a computationalerror of P150,000 in the calculation of the December 31, 2021 inventory. The error resulted in a P150,000 overstatement in the cost of goods sold for the year endedDecember 31, 2021. In October 2022, the entity paid the amount of P500,000 in settlement of litigation instituted againstit during 2021. No provision for this possible loss was made in 2021. The income tax rate is 30%.What adjustment is required to restate retained earnings on January 1, 2022? A. Dr. Inventory 150000 Cr. Retained earnings 105,000 Cr. Income tax Payable 45,000 B. Dr. Inventory 150,000 Cr. Retained Earnings 150,000 C. Dr. Inventory 150,000 Cr. Retained Earnings 150,000 Dr. Litigation loss 500,000 Cr. Cash 500,000
