Fonda Motorcycle Shop sells motorcycles, ATVs, and other related supplies and accessories. During the taking of its physical inventory on December 31, 20Y8, Fonda Motorcycle Shop incorrectly counted its inventory as $337,500 instead of the correct amount of $328,850.a. State the effect of the error on the December 31, 20Y8, balance sheet of Fonda Motorcycle Shop.b. State the effect of the error on the income statement of Fonda Motorcycle Shop for the year ended December 31, 20Y8.c. If uncorrected, what would be the effect of the error on the 20Y9 income statement?d. If uncorrected, what would be the effect of the error on the December 31, 20Y9, balance sheet?
Fonda Motorcycle Shop sells motorcycles, ATVs, and other related supplies and accessories. During the taking of its physical inventory on December 31, 20Y8, Fonda Motorcycle Shop incorrectly counted its inventory as $337,500 instead of the correct amount of $328,850.a. State the effect of the error on the December 31, 20Y8, balance sheet of Fonda Motorcycle Shop.b. State the effect of the error on the income statement of Fonda Motorcycle Shop for the year ended December 31, 20Y8.c. If uncorrected, what would be the effect of the error on the 20Y9 income statement?d. If uncorrected, what would be the effect of the error on the December 31, 20Y9, balance sheet?
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
Chapter8: Inventories: Special Valuation Issues
Section: Chapter Questions
Problem 13P: Errors As controller of Lerner Company, which uses a periodic inventory system, you discover the...
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Fonda Motorcycle Shop sells motorcycles, ATVs, and other related supplies and accessories. During the taking of its physical inventory on December 31, 20Y8, Fonda Motorcycle Shop incorrectly counted its inventory as $337,500 instead of the correct amount of $328,850.
a. State the effect of the error on the December 31, 20Y8,
b. State the effect of the error on the income statement of Fonda Motorcycle Shop for the year ended December 31, 20Y8.
c. If uncorrected, what would be the effect of the error on the 20Y9 income statement?
d. If uncorrected, what would be the effect of the error on the December 31, 20Y9, balance sheet?
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