The income statement of TINKER CORP. shows a net income of P175,000 for the year ended December 31, 2014. Adjustments were made for the following errors: 1 December 31, 2013, inventory overstated by P22,500. 2 December 31, 2014, inventory understated by P37,500. 3 A P10,000 customer's deposit received in December 2014, was credited to sales in 2014. The goods were actually shipped in January 2015. What is the unadjusted net income of Uruguay Co. for the year ended December 31, 2014? A. P234,000 C. P170,000 В. P125,000 D. P200,000
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- 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?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?Assuming a companys year-end inventory were understated by $16,000, indicate the effect (overstated/understated/no effect) of the error on the following balance sheet and income statement accounts. A. Income Statement: Cost of Goods Sold B. Income Statement: Net Income C. Balance Sheet: Assets D. Balance Sheet: Liabilities E. Balance Sheet: Equity
- Assuming a companys year-end inventory were overstated by $5,000, indicate the effect (overstated/understated/no effect) of the error on the following balance sheet and income statement accounts. A. Income Statement: Cost of Goods Sold B. Income Statement: Net Income C. Balance Sheet: Assets D. Balance Sheet: Liabilities E. Balance Sheet: EquityIf 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?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?
- While examining the December 31, 2010 financial statements of Dawn Company, the following errors are discovered: Inventory at January 1 had been overstated by P50,000.; Inventory at December 31 was understated by P100,000.; During 2010, Dawn received a P200,000 cash advance from customer for merchandise to be manufactured and shipped during 2011. The collection was credited to sales revenue.; The net income reported on the 2010 income statement before reflecting any adjustments for the above items is P5,000,000. What is the corrected net income for the year ended December 31, 2010? Choices; 4,950,000 5,150,000 5,100,000 4,850,000Sunflower Co. reported net income of P150,000, P180,000, and P220,000 for the years 2017, 2018, and 2019. However, the following errors were detected and were not yet corrected:· 2017 ending inventory is overstated by P6000.· 2018 beginning inventory is overstated by P6000.· A prepayment for rent for three years amounting to P9000 was expensed in full in 2018.How much is the correct 2019 net income?(Error Analysis) The before-tax income for Lonnie Holdiman Co. for 2017 was $101,000 and $77,400 for 2018. However, the accountant noted that the following errors had been made:1. Sales for 2017 included amounts of $38,200 which had been received in cash during 2017, but for which the related products were delivered in 2018. Title did not pass to the purchaser until 2018.2. The inventory on December 31, 2017, was understated by $8,640.3. The bookkeeper in recording interest expense for both 2017 and 2018 on bonds payable made the following entry on an annual basis.Interest Expense 15,000Cash 15,000The bonds have a face value of $250,000 and pay a stated interest rate of 6%. They were issued at a discount of $15,000 on January 1, 2017, to yield an effective-interest rate of 7%. (Assume that the effective-yield method should be used.)4. Ordinary repairs to equipment had been erroneously charged to the Equipment account during 2017 and 2018. Repairs in the amount of $8,500 in 2017 and…
- Headlands Industries reports net income of $86,320 in 2017. However, ending inventory was understated by $6,990. What is the correct net income for 2017? The correct net income List of Accounts What effect, if any, will this error have on total assets as reported in the balance sheet at December 31, 2017? in the balance sheet will be v by the amount that ending inventory is $ List of Accounts %24During 2016, WMC Corporation discovered that its ending inventories reported on its financial statements were misstated by the following amounts: 2014 understated by $120,000 2015 overstated by 150,000 WMC uses the periodic inventory system and the FIFO cost method. Required: 1. Determine the effect of these errors on retained earnings at January 1, 2016, before any adjustments. Explain your answer. (Ignore income taxes.) 2. Prepare a journal entry to correct the error. 3. What other step(s) would be taken in connection with the error?The draft accounts of Kale & Co. for the year ended 31st Mar 2022 include the following: Revenue $8,000 Gross profit $2,000. It was subsequently discovered that revenue had been understated by $1,000 and closing inventory overstated by $500.After correction of these errors the gross profit percentage margin will be (to 1 d.p.)?