Prepare the necessary adjustments if any for the items

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The annual audit of the accounting records and draft financial statements of Blowfly Ltd as at 30 June 2021 revealed the following errors and omissions:

i) The purchase price of $45,000 for a new vehicle purchased on 1 July 2018 was debited to the repairs expense account. Motor vehicles are depreciated using the straight-line method over 5 years with a zero residual value.

ii) The unearned revenue balance at 30 June 2021 of $125,000, included $15,000 which was earned on 1 March 2020.

iii) During the annual stocktake $20,000 of inventory for the year was discovered to be damaged and not able to be sold.

Required

Problem 1: Assume all errors and omissions are material. Prepare the necessary adjustments (if any) for these items

Reference no: EM132630840

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