User Account

All Pages

Compute the total effect of the errors on the balance

Assignment Help Accounting Basics
Reference no: EM133124624

Question - Error Analysis - Peter Henning Tool Company's December 31 year-end financial statements contained the following errors.

 

December 31, 2020

December 31, 2021

Ending inventory

$9,600 understated

$8,100 overstated

Depreciation expense

$2,300 understated

-

An insurance premium of $66,000 was prepaid in 2020 covering the years 2020, 2021, and 2022. The entire amount was charged to expense in 2020. In addition, on December 31, 2021, fully depreciated machinery was sold for $15,000 cash, but the entry was not recorded until 2022. There were no other errors during 2020 or 2021, and no corrections have been made for any of the errors. (Ignore income tax considerations.)

Required -

a. Compute the total effect of the errors on 2021 net income.

b. Compute the total effect of the errors on the amount of Henning's working capital at December 31, 2021.

c. Compute the total effect of the errors on the balance of Henning's retained earnings at December 31, 2021.

Reference no: EM133124624

Questions Cloud

Demand-supply and covid-19 pandemic : a. Assume the UK economy was initially at the equilibrium, explain why there was a panic buying on some essential products before the first lockdown officially
Investigate issue using statistical analysis : Explain which data collection method you would use and what procedures you would follow to apply this method to this situation
Development change the demand for labour : Workers in a certain occupation will soon require a government issued license to legally practice in that occupation. To get the new license workers will need t
What will be the net realizable value of accounts receivable : If the company writes-off a receivable of $250 what will be the net realizable value of accounts receivable after the write off
Compute the total effect of the errors on the balance : An insurance premium of $66,000 was prepaid in 2020 covering the years 2020, 2021, and 2022. Compute the total effect of the errors on the balance
Understanding of culture change : What is your understanding of culture change and why do you think it is important in long-term care organizations?
Prepare a journal entry to record depreciation from January : For each of these disposals, prepare a journal entry to record depreciation from January 1, 2021, to the date of disposal, if required
Develop an estimated regression equation : Develop an estimated regression equation showing how total points earned is related to hours spent studying - Predict the total points earned by Mark Sweeney
Develop an understanding of how human behaviour impacts : Through this course, you have been exposed to numerous concepts and theories that seek to develop an understanding of how human behaviour impacts the overall op

Reviews

Write a Review

Accounting Basics Questions & Answers

  Find the operating income under variable costing

Fixed manufacturing overhead (planned and actual): $1,200. Find the Operating income under variable (direct) costing

  The management of freshwater corporation is considering

the management of freshwater corporation is considering dropping product c11b. data from the companys accounting system

  Sweeten company had no jobs in progress at the beginning of

sweeten company had no jobs in progress at the beginning of march and no beginning inventories. it started only two

  Prepare the statement of cash flows

Financial statements for E-Perform, Inc. follow: Prepare the statement of cash flows, using the indirect method

  Total direct labor hours budgeted for particular month

Overhead Budget, Flexible Budget Spelzig Company manufactures radio-controlled toy cars. Spelzig has developed the following flexible budget for overhead.

  How much amortization expense will johnson recognize

How much amortization expense will Johnson recognize on the Income Statement for the year ended December 31st, 2017? why?

  Provide recommendations to the cpa about how to select

A CPA is interested in testing the fairness of the ending inventory balance at an audit client. He has relatively little experience using statistical sampling methods and, does not like to turn anything over to random chance.

  Calculate the operating income

Moran Company reports the following operating results for the month of August: sales $320,000 (units 5,000); Calculate the operating income

  Discuss what is eastwicks break-even sales volume

Fixed costs total $200,000. What is Eastwick's break-even sales volume

  Determine the amount to be reported as the cost of the land

An old warehouse on the property was demolished at a cost of $7,300; Determine the amount to be reported as the cost of the land

  Prepare a statement comparing the depreciation expense

Prepare a statement comparing the Depreciation Expense and Net Book Value per year under both methods - What is a stock split? Why would a company choose to split its stock?

  What is her adjusted gross income

Tamara Moore is an unmarried, 37-year-old taxpayer. Tamara contributed $1,500 to her traditional IRA, which she will deduct. What is her adjusted gross income

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd