User Account

All Pages

Prepare a journal entry to correct the error

Assignment Help Accounting Basics
Reference no: EM133069439

Question - Wilkins Food Products Inc. acquired a packaging machine from Lawrence Specialists Corporation. Lawrence completed construction of the machine on January 1, 2019. In payment for the machine Wilkins issued a three-year installment note to be paid in three equal payments at the end of each year. The payments include interest at the rate of 14%. Lawrence made a conceptual error in preparing the amortization schedule, which Wilkins failed to discover until 2021. As a result of the error, Wilkins understated interest expense by $61,000 in 2019 and $56,000 in 2020.

Required -

1. Indicate in the table below which accounts are incorrect as a result of these errors at January 1, 2021 and whether those accounts are understated or overstated. (Ignore income taxes.)

2. Prepare a journal entry to correct the error.

3. Will Wilkins account for the error (a) retrospectively or (b) prospectively?

Reference no: EM133069439

Questions Cloud

Saudia arabia 2030 vision : SHEHANA is startup company which design and manufacturing electric 3d printing cars. SHEHANA is one of the most companies to acheve Saudia Arabia 2030 Vision.
Estimate the company total manufacturing overhead for June : Estimate the company's total manufacturing overhead for June through August if 40,000 total direct labor hours are budgeted for that specific three-month period
Differences in reimbursement model : Explain the similarities and differences in the Reimbursement model(s) that are used in academic medical centers versus an acute community hospital.
Green card or special visas : Bella is a citizen of the Cayman Islands. Now, they travel to the U.S. less frequently. They do not have a Green Card or any special Visas.
Prepare a journal entry to correct the error : As a result of the error, Wilkins understated interest expense by $61,000 in 2019 and $56,000 in 2020. Prepare a journal entry to correct the error
Raise the interest rate on the loan : A one-year ARM has a 60-day lookback period. Up until the last month of therate adjustment period, interest rates had risen 0.25%.
What has happened to the food cost over the first six months : Using the above figures express the Food cost as a % of sales for each month and explain what has happened to the food cost over the first six months
What is the importance of the loan-to-value ratio : What is the importance of the loan-to-value ratio (LVR)? If the LVR is 55% for a loan based on a firm's accounts receivable, is the credit risk of the lender fu
Identify the type i and type ii errors : The accounts of 4,500 credit card customers out of a sample of 40,000 that were reviewed did not perform satisfactorily. The credit scores assigned to these app

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Theory of interest - term structure of interest rates

Term Structure of Interest Rates

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

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