At Hébert Company, the following errors were discovered after the transactions had been journalized and posted: 1. A collection on account from a customer for $780 was recorded as a debit to Cash of $780 and a credit to Service Revenue of $780. 2. The purchase of office supplies on account for $1,730 was recorded as a debit to Equipment of $1,370 and a credit to Accounts Payable of $1,370. (a) Indicate the impact of each error on the balance sheet and income statement by stating whether assets, liabilities, owner's equity, revenue, expense, and net income are under-stated (U), overstated (O), or not affected (NA). (b) Prepare the correcting entries.

At Hébert Company, the following errors were discovered after the transactions had been journalized and posted: 1. A collection on account from a customer for $780 was recorded as a debit to Cash of $780 and a credit to Service Revenue of $780. 2. The purchase of office supplies on account for $1,730 was recorded as a debit to Equipment of $1,370 and a credit to Accounts Payable of $1,370. (a) Indicate the impact of each error on the balance sheet and income statement by stating whether assets, liabilities, owner's equity, revenue, expense, and net income are under-stated (U), overstated (O), or not affected (NA). (b) Prepare the correcting entries.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Subject: accounting
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